Survey reveals many Americans still face financial challenges

The rising cost of living and a slow job growth rate, combined with the loss of the payroll tax breaks have made it difficult for many Mississippi families to make ends meet. When this happens, some debtors may find that filing for Chapter 7 bankruptcy is the best way for them to eliminate their debts, providing them with a fresh financial start.

The story of one Mississippi woman's financial struggles is not unusual. She relates how the prices of milk and gasoline have jumped drastically over the past year. This is especially troubling, given her husband commutes 112 miles to work each day. In addition, once the payroll tax break was eliminated, she saw more than $270 deducted from her paycheck each month. So even though she earned a $1,160 pay raise this year, the costs of supporting her family of four are a continuing challenge. She is not alone.

Nationwide the median income fell by more than $4000 since the year 2000. In addition, 60 percent of the jobs lost during the recession were middle class jobs. So far, these same jobs have only seen a 22 percent recovery rate. This is not surprising, seeing as a recent Rutgers University study shows that 40 percent of people are very concerned about job security. The same study also revealed that less than a third of those surveyed think the economy will improve in the coming years.

Sometimes a debtor may feel that the amount they owe their creditors is utterly overwhelming. When this happens, they may find that filing for Chapter 7 bankruptcy is one way for them to regain control over their finances. The Chapter 7 bankruptcy process is relatively short, taking only three to six months to complete. Through a Chapter 7 bankruptcy, the debtor will sell their assets in a process known as liquidation, with the proceeds being used to satisfy their debts. Once a Chapter 7 bankruptcy is complete, creditors can no longer attempt any further collections on the debts.

When debtors are burdened with mounting debts, they still have options for repayment. Chapter 7 bankruptcy is one way debtors can clear their debts and move forward with a clean financial slate.

Source: CNNMoney, "Why America's middle class is losing ground," Tami Luhby, March 5, 2013

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