Many Tennessee residents have heard stories of celebrities and others with significant wealth filing for bankruptcy. For some, it may be hard to understand how someone who makes millions of dollars a year can end up broke. However, it is often the same issues that can plague both those with significant assets and those without. Regardless of the reason, however, bankruptcy can be an option for all people facing mounting debt.
The root cause of most financial problems is the accrual of debt – something that can affect those with six figure incomes as well as those who make less. Responsibly managing one’s finances can often buffer a person against the potential pratfalls of owing money to banks, credit card companies and more. However, even prudent people can face debt when formerly sound investments, for example, fail, or an unexpected illness requires medical expenses beyond one’s means – even if insurance is there to help.
Money may not last forever even in stable financial times, which is why even many once-rich celebrities have filed for personal bankruptcy. It is important to understand that income and wealth are not always correlated, and debt can consume people from all income levels. The middle class can accumulate wealth with wise investments, while the rich can become bankrupt due to certain financial decisions or unexpected expenses. It is easy to suggest that responsible money management will stave off all worries, but once a person faces financial difficulties, the real focus should turn to how one can regain control.
Bankruptcy can provide anyone a fresh start and the ability to stop creditor harassment. Individual circumstances vary, and bankruptcy is not necessarily a one-size-fits-all process. With the help of an experienced bankruptcy attorney, a person can put the brakes on mounting debt and seek a new financial path.
Source: Business Insider, “Why A 6-Figure Salary Won’t Keep You From Going Bankrupt,” Jenna Goudreau, Jan. 3, 2014
