Recently, news outlets reported that bankruptcy filings in Wisconsin have reached an all-time low. This is exciting and encouraging news, as it means that more and more families are finding their way to more stable financial footing. What is behind this decrease in filings and what steps can you take to ensure that you do not need to file for bankruptcy?
What’s Behind the Decrease?
During the peak of the great recession in early 2010, nearly 16,000 Wisconsin consumers and businesses filed for bankruptcy. During the first six months of 2018, roughly 8,800 individuals and consumers filed bankruptcy petitions. This is nearly 45 percent decrease from the peak in 2010.
A number of different factors appear to be contributing to the decreasing Wisconsin bankruptcy filing rates. First, Wisconsin’s unemployment rate is around 2.9 percent, meaning that households are not only seeing more income than they have in recent years but they are also seeing steady income. This is allowing more and more individuals to pay off their existing debts and responsibly assume new debts.
Second, it appears that lenders have gotten much better at helping borrows modify their mortgages when necessary, rather than forcing them into bankruptcy. Many lenders did not have such provisions in place during the great recession and were overwhelmed by the magnitude of mortgage troubles across the nation.
All of this is welcome news for Wisconsin families, but it does not mean that Wisconsin is out of the woods entirely when it comes to needing to file for bankruptcy. Read on to learn about some proactive steps you can take to shore up your finances and recognize the warning signs that you may be at risk of bankruptcy.
Reducing Your Risk of Bankruptcy
It has been said that an ounce of prevention is worth a pound of cure, and that is particularly true when it comes to bankruptcy. Being able to recognize when you are at risk of bankruptcy is one the most important steps when it comes to ensuring you have long-term financial footing. Take some time to sit down with your finances and assess your debts and savings; do you have enough money to carry you through six months of unemployment? If not, now is a good time to start cutting back on spending and increasing your savings.
Additionally, take some time to assess your career and your personal circumstances. Individuals who have been in the same career for a long time are particularly likely to need to file for bankruptcy when their industry takes a hit. The same is true for people who are heading towards divorce or who expect to face significant medical bills in the future. It isn’t fun, but focusing on building your savings now can pay off in a big way down the road.
Need to File for Bankruptcy?
At Hanson & Payne, LLC, we know that no one expects to file for bankruptcy. While the economy is doing better and job market is more stable, we are all just one unexpected life change away from facing financial uncertainty. If that happens to you, our experienced bankruptcy attorneys are ready to help get you through this rough patch in your life. If you need to file for bankruptcy, contact us today.