Consumers Struggle to Make Ends Meet and End Up in Debt


According to a recent news release from the Consumer Financial Protection Bureau (CFPB), about 40% of adults in the U.S. are struggling to make ends meet. In other words, a large percentage of Americans do not feel that they earn enough money each month to pay bills and to have the minimum money remaining for savings or for activities of daily living.
While avoiding bankruptcy can be beneficial for some consumers, for many debtors, filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy can provide a fresh start or a way to get back on track. To better help consumers to understand their financial well-being, the CFPB has created an interactive tool. When so many consumers are struggling with bills and debt, when is it time to begin thinking about personal bankruptcy?
CFPB Develops Interactive Tool to Help Consumers
Many consumers need help managing their finances and figuring out when their debt may be insurmountable. With about 40% of adults indicating that they are struggling, there is a need for debt management tools.
This information about consumer financial struggles comes from the National Financial Well-Being Survey, which the CFPB started conducting last year. According to the CFPB news release, “these survey results are beginning to measure and examine the financial well-being of consumers” to help them better understand financial management and how to get help if they are struggling with debt. That is where the interactive tool comes in. As CFPB Director Richard Cordray explains, “the new tool we are releasing allows consumers to measure their own financial well-being and helps them take better control of their financial futures.”
What is the tool? In short, it is based on the CFPB’s Financial Well-Being Scale, and it allows consumers to track their well-being over time as well as to compare themselves to other Americans based on income level, age, and employment status. In assessing their financial well-being through the tool, consumers can also access CFPB resources for meeting financial goals.
Need for More Analysis of Consumer Financial Well-Being
While the interactive tool may be able to help some consumers who are struggling with debt or to make monthly bill payments decide whether bankruptcy is right for them, the CFPB’s news release also raises an important question: Why are so many Americans struggling financially? Are there similar characteristics among those that report they have difficulty making ends meet? Here are some facts that the CFPB reported:
  • About 43% of consumers have difficulty finding the money to pay their bills;
  • 34% of American consumers report that they have experienced a material hardship in the last year (which includes not having enough food, not being able to afford housing, and not being able to afford medical treatment);
  • Financial well-being is linked to consumers’ education level, income level, and employment status;
  • Financial well-being tends to be higher for older adults; and
  • Younger adults aged 34 and under tend to have the lowest levels of financial well-being.
Do you have questions about debt management or filing for bankruptcy in the Chicago area? A dedicated Oak Park bankruptcy lawyer can speak with you today. Contact the Emerson Law Firm to learn more about how we can assist you.
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