Number 1 Reason People File For Bankruptcy

Bankruptcy Due to Medical Bills

It’s estimated that medical debt is the number one source of personal bankruptcy filings in the United States. As a Spokane bankruptcy attorney, I’ve found that it’s the same here in the Spokane area. Just one serious medical event can take a toll on a person’s finances.

It’s usually a double edged sword—you get the unexpected medical bills, and you were unable to work for a period of time. So your wages and income dropped making the situation even more difficult to recover from. Usually, a person or family has some savings and can make it out of one limited event, but if medical issues and bills reoccur and those emergency resources have been exhausted, then there’s nothing left to fall back on

Emergency Savings Can Help But Most People Don’t Have Enough

According to recent data 69 percent of Americans have about $1,000.00 in savings. Not enough to get someone through a medical crisis. There are things a person can do to ramp up their savings, which can help avoid medical debt and possible bankruptcy. Start with the basics, like creating a budget so you can accurately track what you spend. Identify possible ways to cut expenditures out of your budget and move that money into savings. Look for expenses like going out to dinner, spending too much on food or clothing, cable, giving money to children. Take this money and put it into an emergency fund.