It is no secret that credit card debt is a crippling issue for many American families. Both here in Kentucky and elsewhere around the nation, credit card debt is reaching record highs. There are several key issues that can bring people to the point of financial instability, but there are also options to help correct these issues. For individuals or families who can no longer handle their debt load, filing for Chapter 7 bankruptcy may be the most responsible solution in handling debt.
Even for people who are financially literate and fastidious in their budgeting, unforeseen circumstances can arise requiring influxes of money. Medical debt is one of the most common causes of unexpected costs, but even something as simple as a fender bender can set one back hundreds or even thousands of dollars. The temptation exists to fall back on a credit card in situations like these, but it is more financially viable to set aside a "rainy day" fund if possible to handle such costs.
Credit card companies are not innocent in this epidemic either. Many companies will offer incentives to sign up for new cards or increase credit limits, which can lead to overspending. Remember that credit cards are a loan, and no matter how attractive the incentives might be, that loan will have to be paid back with interest.
For some Kentucky residents, credit card debt has become too much of an issue to be handled by scaling back on spending or addressing budget concerns. For these individuals, a Chapter 7 bankruptcy filing can be integral in their return to financial stability. By liquidating assets to pay down creditors and forgiving other debts outright, a Chapter 7 can be the light that leads the way back to a healthy bank account.