Profile of a BK Filer

[Pizza]

Harvard professor Elizabeth Warren recently published the following profile of the average person who files bankruptcy:

* Average age is 38
* 44% are married couples
* 30% are women filing alone
* 26% are men filing alone
* Slightly better educated than the general population
* Two out of three have lost a job
* Half have experienced a serious health problem
* Fewer than 9% have not suffered a job loss, medical event or divorce

[Whittier]

wow I fall in the 37.5% of the profile 3/8=.0375

[OhioFiler]

I'm curious to know what qualifies as a serious health problem.

[SMinGA]

Would be interesting to know the definitions used - but something like a 'serious health problem' could lead to a bankruptcy in various ways. Directly would be with the accumulation of hefty medical bills. But also indirectly, by loss of wages that lead to one using credit cards to replace the missing income and/or no longer being able to pay debt balances already owed.

[flyinbroke]

Interesting stats. Most assume it is the uneducated shopaholics who file. This would not be the case here.

[OhioFiler]

Would be interesting to know the definitions used - but something like a 'serious health problem' could lead to a bankruptcy in various ways. Directly would be with the accumulation of hefty medical bills. But also indirectly, by loss of wages that lead to one using credit cards to replace the missing income and/or no longer being able to pay debt balances already owed.

Understanding the purpose of the study will help identify what is considered a serious health problem. This study will be used to cite the need for health care reform by the party in power in Washington.

[BCA2009]

Wow

My wife and I are both 38. We are filing due to her losing her Job, Me having some health issues (and a bad investment). We both have advanced degrees.

We fit the profile 100%

[BCA2009]

Would be interesting to know the definitions used - but something like a 'serious health problem' could lead to a bankruptcy in various ways. Directly would be with the accumulation of hefty medical bills. But also indirectly, by loss of wages that lead to one using credit cards to replace the missing income and/or no longer being able to pay debt balances already owed.

You hit he nail on the head. We had good insurance and could afford the medical care, but I was out of work for 5 months and then took a job making 12K per year less. Then my wife's company cut her salary by 20K. We had no credit card debt when I got sick. Over the next two years we blew thru our savings and racked up 37K incredit cards, just trying to stay afloat. Then my wife lost her job in Nov '09.

Turned out ot be a blessing. We then qualified for BK and instead of continuing to tread water, we now see a new future ahead.

[momisery]

Wow... it use to be about 66% of the BK's file were due to medical debt. We are older than the average, but we fit the rest of the stuff.. Married, job loss, medical illness, and some college for both of us ... As for medical debt, I guess that depends upon you income or assets. If you laid off for almost two years paying bills on one income medical debt of any sort and put you under. Now days they don't take payments without charging you interest at least here in MO they don't. And the interest eats up all of the payment you are making so you never get them paid off either.

[blessed]

Turned out to be a blessing. We then qualified for BK and instead of continuing to tread water, we now see a new future ahead.

That's how I chose my screen name. ;) Once I realized bk was going to help my family have a future I got so excited. lol

[brokenymom]

5 out of 9 for me. still married we both have jobs and are in good health

[Pizza]

Hope it's been an interesting figure.

It really puts into perspective the outdated attidue that 'deadbeats file for bankruptcy'... only 9% of filers appear to fit this description - and even those haven't been thoroughly analyzed - could be a 'Money Pit' house, major expenses on vehicles, child care, who knows...

[Flamingo]

Interesting stats. Most assume it is the uneducated shopaholics who file. This would not be the case here.

Remember, it's debt that causes bankruptcy. If the debt is run up by shopping, gambling, etc., and a job loss hits removing any way to pay the debt, it's just debt as a statistic. And one does not have to be uneducated to be a shopaholic, gambler, etc. OCD, which is genetic, is a major cause of impulse buying and gambling along with depression, never really learning to budget, bad financial planning, etc.

If large debt is not present when a job loss hits and/or a major medical event takes place and backup savings are in place along with proper insurance and long or short-term disability insurance, one may never even have to consider filing.

[Pizza]

Remember, it's debt that causes bankruptcy. If the debt is run up by shopping, gambling, etc., and a job loss hits removing any way to pay the debt, it's just debt as a statistic. And one does not have to be uneducated to be a shopaholic, gambler, etc. OCD, which is genetic, is a major cause of impulse buying and gambling along with depression, never really learning to budget, bad financial planning, etc.

If large debt is not present when a job loss hits and/or a major medical event takes place and backup savings are in place along with proper insurance and long or short-term disability insurance, one may never even have to consider filing.

That's what credit counseling is for... too bad when you're unemployed for months or even years, you can't make a budget with zero...

[meateater]

Not sure where I fit in. After finishing grad school, I could not find a job, spent about 4 years underemployed and without health insurance. Although i didn't realize it at the time, I was going deeper into credit card debt paying for food and necessaries (a few vacations, but nothing extravagant). I was very depressed about some serious family problems, so I got a prescription for antidepressants (I was in a research study, so didn't have to pay to see the psychiatrist).

I was in my 30's when I filed. Is charging antidepressants a medical expense (if i had had insurance, it would have been a small co-pay). Does underemployment or inability to get a job count as job loss? From the outside, it would appear that I was working and in good health leading up to my filing, even though I had a diagnosed illness and was underemployed for years.