Consumer Payment Card News

Bankruptcy Drivers

A recent bankruptcy study has found being overextended on credit is the main reason for consumer bankruptcies and that women are financially struggling at greater rates then their male counterparts. Reasons for filing bankruptcy: overextended on credit 63%; unexpected expenses 57%; reduction of income 52%; job loss 36%; illness/injury 33%; divorce 15%; birth/adoption of child 9%; death of family member 8%; retirement 5%; and identity theft 2%. The Institute for Financial Literacy also found that 54% of the females in the study were in credit counseling. Females currently make up 51% of the U.S. population. Those in credit counseling and filing bankruptcy by age: 3% were 18-24; 21% were 25-34 years of age; 29% were were 35-44 years of age; 25% were 45-54 years of age; 14% were 55-64 years of age; and nearly 8% were 65 years of age or older. The report noted elevated levels of financial distress, peeking with the 35 to 44 years old group. The Institute for Financial Literacy says this group is seeking out assistance and protection in bankruptcy at twice the rate of their representation of the U.S. population.

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