Society has a tendency to look down on people who grapple with debt. There is an assumption that such people brought the situation on themselves—perhaps through reckless spending or gambling. The truth is, however, that many people struggle with debt even when they did everything “right.”
You may have always paid your bills on time and carefully planned for every major purchase you’ve made. Still, unforeseen circumstances can put you in a situation where you’re suddenly unable to make ends meet.
Causes of debt
Debt and bankruptcy are often viewed as shameful subjects. But many people face these problems through no fault of their own. Below are some of the most common causes of debt:
- Medical expenses: Sudden and significant illness or injury can cost tens of thousands of dollars or more. While no one can predict when something like this will happen, you can prepare for such times. Insurance may initially seem like an unnecessary expense early on, but if tragedy should strike, it can keep you from dealing with medical bills that could cripple your family.
- Student loans: Student loan debt in the U.S. is at an all-time high. Many young adults are now graduating from college with six figures in debt. With the high unemployment rate, finding a job in the current economic climate is difficult. Finding a job that pays enough to cover your living expenses and also pay down your debt is even harder.
- Marriage: Most couples get married before discussing the practicalities of combining households and finances. If you don’t take the time to understand your partner’s financial situation ahead of time, you may inherit their debt without even realizing it.
- Divorce: No one anticipates getting divorced, but it can be expensive when it does happen. Legal fees, child support, alimony, lost income and other expenses can cost thousands of dollars or more.
Life often presents unexpected hurdles. How you respond to these challenges can play a deciding role in your future. For many people struggling with insurmountable debt, bankruptcy has provided a welcome path forward. Declaring bankruptcy can erase your debt and give you a new lease on life.
If you’re struggling with debt and can’t see a way out, it’s worth educating yourself about your options. Bankruptcy might be the fresh start you need.