Bankruptcy Causes: Beware

To think there is one cause that neatly fits each bankruptcy case would be a fallacy. With so many sources of credit and loans in the adult world, there are that many potential sources of debt. For people with patterns of bad behavior when it comes to paying off their debts each month, they are likely to run up debts in a number of areas.

Still, it is not unreasonable to think that one particular source of debt may affect a personal bankruptcy seeker more than others because of his or her individual circumstances. For one, age could be a factor, as it is with health- and education-related obligations.

Perhaps it could be related to one's industry and whether or not the job outlook is promising in that field. Then again, it could all boil down to a simple twist of fate in the form of a change in the weather. In this respect, isolating the individual causes of bankruptcy may make a good deal of sense.

Medical Costs

Though the causes of bankruptcy are plentiful and often co-occur, certain motivators to file for bankruptcy tend to rise above others in terms of prominence. A recent study conducted by researchers at Harvard University and published by the American Journal of Medicine, and also echoed by interested news services worldwide, suggests that costs related to medical bills are the biggest justification of Americans applying for bankruptcy today.

The survey-based scientific report used tabulations of data for people with a minimum amount of medical debt or higher, people who sold their homes to pay these expenses, and people who had trouble maintaining their income as a result of serious illness or injury.

There are those who agree with the results of the study and the assertion that medical bankruptcy is the foremost cause of personal bankruptcy in the United States, and there are those who don't. Certainly, the researchers themselves would uphold the validity of the study, especially with respect to a majority of subjects being incapable of affording their care because their insurance would not cover all costs.

Detractors, meanwhile, holding some other cause above medical expenses as more impacting, point to the low survey response rate and the idea that expensive medical bills do not necessarily mean one will apply for bankruptcy solely because of them. Meanwhile, people more central in the debate may look to the ties between some particular ailment affecting people's ability to work and their subsequent inability to pay their bills.

Job Loss

Unemployment is likely to be another major cause of ordinary people filing for bankruptcy. As with medical costs, those affected may simply be a victim of unfortunate circumstances. Indeed, the interplay between business bankruptcy and personal bankruptcy manifests in a rather interesting dynamic.