Bankruptcy: Knowing the Difference Between Good and Bad Debts

With studies indicating that the average household carries $38,000 in personal debt, many families in Ohio and elsewhere may be experiencing periods of financial hardship. While taking on certain amounts of debt may seem like a part of life, the subsequent monetary obligations can place a person under a significant amount of financial pressure. Those who find themselves struggling to make a living due to high amounts of debt could benefit from seeking advice on how to pursue relief from a bankruptcy attorney.

With average amounts of household debt coming in at around $1,000 more than the previous year, studies suggest more individuals have felt comfortable taking on new debts. However, studies also indicate that the average person may have some level of difficulty understanding the difference between good and bad debts. Of those surveyed in the study, nearly 20 percent of individuals admitted to believing that mortgages were bad debts.

In addition, almost 30 percent of individuals who took part in the survey admitted to believing that credit cards were good debts. When it comes to understanding what type of debt is good or bad, experts suggest that it might be helpful to evaluate a debt and determine the purpose it serves. Regardless of the type of debts one carries, if a person begins having trouble keeping up with monthly monetary obligations, taking on any additional debt might not be advisable.

High amounts of personal debt can leave a person suffering in numerous ways. Upon encountering major financial concerns, a person in Ohio could consider speaking with a bankruptcy attorney for guidance on all the available options for relief. An attorney can evaluate a client’s financial circumstances and assist in forming a strategy to pursue relief from debts though the necessary channels.