Many people in Kentucky rely on credit cards. From daily purchases to emergency expenses, credit card balances can add up quickly. Over time, these balances can quickly overwhelm a consumer, leading to accumulating interest and debt that a person can no longer manage on his or her own. For some who find themselves in this position, a Chapter 7 bankruptcy is a beneficial option.
While the economy continues to be strong and consumer spending remains high, some experts point at the possibility that a recession could be coming in the near future. For those with credit card debt, it could mean there will be even more difficulty managing balances, especially if the recession leads to job loss, salary reduction and other problems. Only 35% of Americans say they have enough savings to carry them through three months if necessary.
One reason that credit card debt is a pressing concern at the moment is because interest rates are higher than in the past, remaining just under 18%. When a person allows balances to add up, interest accumulates, and the end result is often a credit card bill that is unmanageable. A recession could add additional strain to a person who is already struggling to keep up with credit card bills.
Through Chapter 7 bankruptcy, a person may be able to deal with certain types of balances once and for all. Bankruptcy allows for the discharge of certain types of debt, including credit card debt. While a Kentucky resident may be reluctant to move forward with this process, it could be a smart way to obtain a better financial future.