Bankruptcy increases among college graduates
Although bankruptcy has become more common in Georgia and throughout the United States, there are still several common misconceptions about bankruptcy and the people who file for it. Many believe that the only people who need the protections of bankruptcy are those who are unemployed or living in poverty. But according to a new study, that is not the case.
The study, which was conducted by the Institute for Financial Literacy, found that the number of college graduates who filed for bankruptcy has increased significantly in recent years. Specifically, people holding a bachelor’s degree accounted for 13.58 percent of bankruptcy filings in 2010, which is a 21 percent increase from the 11.2 percent of filings in 2006.
In addition, the study found, more than 28 percent of filings in 2010 were made by people who attended college but who did not attain a degree. Researchers believe that this group; may be the most at risk for the kind of financial difficulty that necessitates a bankruptcy filing. “This…is because they have all the burdens of school related debt and none of the rewards of an actual degree,” the study stated. In addition, because student loans are not dischargeable in bankruptcy, they may remain in deep debt even after filing for bankruptcy.
Certainly, bankruptcy is most common among those in poverty – about 40 percent of filings were made by people making less than $20,000 per year. However, the number of filers making over $60,000 per year increased by 67 percent from 2006 to 2010.
Further, the number of filings by married people also increased in 2010, when more than 60 percent of filings were made by adults who were married. From these and similar statistics, it is apparent that the face of bankruptcy is changing significantly in the post-recession economy. As such, you should not feel embarrassed or ashamed to contact an Atlanta bankruptcy attorney to discuss your options.
Source: Wall Street Journal, “Marriage, College, Job Won’t Ward Off Bankruptcy,” Eric Morath, Sept. 13, 2011