Knowing the Impact of Bankruptcy to the Middle Class
Even with the change in federal bankruptcy laws, there are an increasing number of middle class families who are struggling financially and, ultimately, will file bankruptcy at some point in their lives. If you’re one of them, choose the best bankruptcy lawyer in san diego to guide you through the legal process. With the middle class considered the most prominent group of individuals to file bankruptcy, many wonder how we even have a middle class in the United States.
Since the middle class is not clearly defined by the United States government, this leaves a somewhat gray area in which we can all classify ourselves as middle class, upper class or even working class. In general, however, most Americans agree that the middle class is generally defined as someone who has completed college level education, carries a well established occupation and has a regular stream of income on which they can develop some form of wealth for themselves.
In recent statistics, the individuals who commonly file bankruptcy tend to be women who are about middle age; with the average age of 38. While most are college educated, the issues that bring about bankruptcy, in this middle class sector of individuals, is directly tied to a medical issue, loss of employment or many years of surmounting debt.
Interesting enough, these same statistics do not reflect a great propensity of any one race or citizenship status to file bankruptcy, with all races and citizens represented equally when compared to the general population. This is to say, race will not affect your propensity for filing bankruptcy.
As stated, most bankruptcy filers are college educated but, even more astounding, is the fact that most filers carry even more college education than most.
So, what is it that makes the American middle class, then, file for bankruptcy? In examining the income levels of those who have filed, it is amazing at how these individuals, who once may have been a true representation of the middle class, have suddenly fell into a realm of almost certain poverty level. Still, they consider themselves middle class. In fact, by the time bankruptcy is filed, most wage earners will report income below $20,000 annually.
In terms of assets, those who have filed for bankruptcy will usually demonstrate no assets of value and, as a result, have nothing for liquidation to the creditors. Quite simply, the issues that resulted in the deterioration of income and wealth may have led to the sale of assets, as a way to maintain lifestyle, but, ultimately, leading to bankruptcy nonetheless.
So, in the United States to say that our middle class is filing bankruptcy more and more often is a somewhat true statement. While they were classified as middle class when the debts were incurred, the life events that occurred thereafter may have brought them into poverty or lower class, ultimately leading to bankruptcy. So, to say our middle class is filing bankruptcy mores than any other class of individuals is, in part, a true statement, depending on how you examine the facts associated with the bankruptcy filer.