Cause of BK

[justplaintired]

Does anyone else feel like our economy is pushing more people here? Were we live our property taxes have doubled since we purchased our home (1999), my DH health insurance withholding has doubled since then, we all know what gas prices are, and what about groceries? Utility companies all got approved rate increases. However my DH job is just now giving back some benefits it had to take away to keep the doors open. That was over a 3 yr period of cut hours, loss of bonus, loss of vacation... My job has decreased by almost $3k a year. Anyone else have an opinion?

I think that's how we ended up here. First cc usage was luxury things, when all this started 7 yrs ago, then it became trying to survive and pay those cc. Yet the increase kept coming on credit limits, and just so you know, we never asked for one single credit increase, if they just would have kept those limits down we might not have ended up in such a mess. But when you have so much ability to get as much money as you want, it's hard to say no.

I have read on here comparing it to offering an alcoholic alcohol, you hold it out there and eventually they take it. Well you dangle 50K credit in front of a person's face who has no money, what do they think we will do? Say no thanks, Who has that kind of will power? Not us obviously.

[FreshLikeADaisy]

I don't know, Justplaintired. I see your point about credit and I don't doubt that has a lot to do with it for a number of people, but many of us got here via unemployment, illness, etc. Me, I had perfect credit for almost twenty years... and only one credit card. I got credit cards in the mail pretty much every day and tore them all up. I just hated debt, and I liked having the majority of my paychecks free to do as I liked with. But that didn't stop me from having to file when I became disabled and could no longer work, even though I had savings. Savings only last so long.

But once a person is in this situation, I think it's the great equalizer: no matter how we got here, we're all in the same boat now.

So it's different for everyone.... and yet all the same.

[justplaintired]

Yeah I do agree it depends on the situation. For us mostly it was a change in income. We managed the cards alright for quite awhile. Then our income changed and little by little balances grew. I do wish I had more willpower to say no. We managed fine without cards for most of our adult life. Our first card did not come until we were actually in our late 30's. We had purchased our first home and about 2 yrs here, the first cards started coming, and kept coming, more and more, most we said no too, unfornately we did say yes to a few, and after loss of income due to cut backs, we found cards became a way of surviving. It's our own fault we should have never said yes. We created this mess, but I still feel like if it wasn't for cc companies we wouldn't be here. We managed our finances fine until they came along. Honestly the other people that we know who filed did it over cards. I haven't told them about us, too embarrassed. We were those people who said this would never happen to us. Well guess you should never say never.

[FLBK7]

True, you should never say never. I had perfect credit (literally perfect, never a late!) for over 30 years and then my life fell apart: I got divorced and lost my job of many years within a very short interval. I had a minor child to support and the monthly child-support payments stipulated in the divorce agreement were either late, partial or never came. I worked 2 minimum-wage jobs to pay the bills and support my child while looking for something that paid anything near what I used to earn, since I'm a professional with a college degree and decades of experience. But I ended up having to use my credit cards just to survive and pay all the expenses plus the lack of medical insurance that came with the loss of my job. By the time I found a decent job, I was way deep over my head in debt. My credit cards up to the divorce and job loss were hardly ever used and in fact had $0 balance up until then.

So it is different for everyone. I realize the temptation to charge is out there all the time, and the CC companies know this and exploit it to the max. I personally believe that the old usury laws where CC companies were limited by law to charging a maximum 18% interest should be brought back!!!! Hey, savings accounts are only paying maybe half a percent interest these days!!! Why are we letting these greedy companies charge up to 30% just because they think you are suddenly a "bad risk"? This happened to me just before I filed. In retrospect, filing for BK was my only option.

Now, again, I have credit cards with a total of $20K balance that I don't use, or use sporadically just to keep them active. But then again, I have a job, for now. A local government job where I've only been for 7 years. The economic situation is so uncertain and in my area budget cuts are looming even larger. I may not have a job next month. Will I use those $0 balance credit cards if I lose my job?

I don't even want to think about it.

[$$only4ever]

Does anyone else feel like our economy is pushing more people here? Were we live our property taxes have doubled since we purchased our home (1999), my DH health insurance withholding has doubled since then, we all know what gas prices are, and what about groceries? Utility companies all got approved rate increases. However my DH job is just now giving back some benefits it had to take away to keep the doors open. That was over a 3 yr period of cut hours, loss of bonus, loss of vacation... My job has decreased by almost $3k a year. Anyone else have an opinion?

I think that's how we ended up here. First cc usage was luxury things, when all this started 7 yrs ago, then it became trying to survive and pay those cc. Yet the increase kept coming on credit limits, and just so you know, we never asked for one single credit increase, if they just would have kept those limits down we might not have ended up in such a mess. But when you have so much ability to get as much money as you want, it's hard to say no.

I have read on here comparing it to offering an alcoholic alcohol, you hold it out there and eventually they take it. Well you dangle 50K credit in front of a person's face who has no money, what do they think we will do? Say no thanks, Who has that kind of will power? Not us obviously.

Honestly, I don't think that I will ever have another credit card again. I don't trust myself. It is just too easy to get caught up in the debt trap again.

[One Half Full]

Actually, I consider myself here due to the economy. My job had to constantly cut costs in health insurance. When I started working there, there was no deductable, and a co-pay of about 10 dollars, and no "yearly cealing." We had company pensions. We got pay raises of about 5%. Now, 1000, deductable, no pension, no raises for several years. We had free parking, now it is 90$ per month. Then, of course, the food, the taxes, everything is unstable, and you can't make any kind of budget. Its not as though I can stop doing "fun activities" in order to make ends meet. 10 years of work, not enough money over basic living to pay for fun stuff or vacations. I never used my credit cards improperly. They only got charged up when I finally got to the point where common living expenses were like 300$ more than my income, usually in the winter due to heating costs. I obviously knew that they would rise, everything does, but rise without cost of living adjustments, and no one in the company hiring, so I couldn't get a higher paying job in another department. Oh well, I could go on, but I would say, yes, I consider the economy the "Driver" of high health care, and high taxes and high credit card debt.

[justplaintired]

Honestly, I don't think that I will ever have another credit card again. I don't trust myself. It is just too easy to get caught up in the debt trap again.

I am in total agreement, no more cc here. I think we just can't manage them and we really don't need them. We don't and won't travel, we are both home bodies. My weakness has been my house and buying for it, and that has stopped. If we need something it will wait til we can afford it. The stress paying those cc has caused has about drove me off the deep in and I don't ever want to live this way again!

[tinroofrusted]

I think that gas prices right now are one of the biggest problems in the world.
I know that right now, we have about $250 a month going out for gasoline alone... and I have a car that gets 35 MPG! It's terrible.

[Flamingo]

As I look back on the years prior to our BK, I thought we would never be in the position to even think about filing bankruptcy. However we did overspend and had a lot of bills but our income was high and we were able to still save and pay all our bills on time. Then came the tech bust of 2000/2001. My husband's entire department was let go and his yearly income of almost six figures just disappeared. There were no packages offered to those let go. It was awful. He thought he would find a job quickly with his expertise and position but could not. He clerked in a convenience store part time after the unemployment stopped and even looked into relocating to find a position. There was nothing - his field (UNIX) just went by the wayside. In the years prior he traveled the world working on systems for major corporations. It was difficult to keep him from getting depressed and we tried hard not to file by using our savings and his 401(k) but we all know when the time comes to file. The black hole of ever increasing debt and robbing Peter to pay Paul was becoming a huge vortex. We got over our emotions about it all, bit the bullet and did inquiries about filing and were given the name of a good attorney. We really should have investigated filing way sooner than we did.

We are spiraling again into that time where people will lose jobs and be unable to recover and gain back the salary they once had. The key to avoid problems if that should happen is not have any major debt when a job loss should occur just in case you cannot find a similar paying job quickly. Since our discharge, we have made sure that if one of us should lose our job, we would not be in the position to have to file bankruptcy again. We learned by going through it once. It was an awful time that I never want to go through again.

[tinroofrusted]

As I look back on the years prior to our BK, I thought we would never be in the position to even think about filing bankruptcy. However we did overspend and had a lot of bills but our income was high and we were able to still save and pay all our bills on time. Then came the tech bust of 2000/2001. My husband's entire department was let go and his yearly income of almost six figures just disappeared. There were no packages offered to those let go. It was awful. He thought he would find a job quickly with his expertise and position but could not. He clerked in a convenience store part time after the unemployment stopped and even looked into relocating to find a position. There was nothing - his field (UNIX) just went by the wayside. In the years prior he traveled the world working on systems for major corporations. It was difficult to keep him from getting depressed and we tried hard not to file by using our savings and his 401(k) but we all know when the time comes to file. The black hole of ever increasing debt and robbing Peter to pay Paul was becoming a huge vortex. We got over our emotions about it all, bit the bullet and did inquiries about filing and were given the name of a good attorney. We really should have investigated filing way sooner than we did.

We are spiraling again into that time where people will lose jobs and be unable to recover and gain back the salary they once had. The key to avoid problems if that should happen is not have any major debt when a job loss should occur just in case you cannot find a similar paying job quickly. Since our discharge, we have made sure that if one of us should lose our job, we would not be in the position to have to file bankruptcy again. We learned by going through it once. It was an awful time that I never want to go through again.

Flamingo I had to respond- with the economy the way that it is, I went back to finish my nursing degree in January. things are right right now in our house, and I run a business, but at the same time, to have something to fall back on such as a nursing career "just in case" will ensure that should anything ever happen to either of us job-wise, we won't have to worry where ournext meal is coming from.

And withthat said, I am scared to think of how much worse things are going to get before they start to get better. YIKES!