Coronavirus To Cause Financial Hardship
In the pre-coronavirus economy, I found that many people were teetering on the edge between solvency and bankruptcy. In other words, one event; whether a divorce, an illness, loss of job or even a lack of overtime could send an individual or a family into a downward financial spiral.
Once the debt begins to pile up, the interest on that debt grows and the minimum monthly payments become high. This causes the need to use more credit and the pattern repeats itself until the spiral becomes insurmountable. The minimum monthly payments don’t reduce the debt but will often allow the charge cards to be used – until there is not enough income to even make the minimum monthly payments on the various credit cards.
The coronavirus has brought our economy – particularly our stores, restaurants and entertainment sector to a standstill. It is unknown how long the corona effect will last or what will be the effect of the weeks or months of business stagnation. How many restaurants will be forced out of business and how many service jobs will be lost? The unknown is scary but when this bumpy ride ends the one certainty is that people will be in worse financial shape than they were pre-coronavirus.
While bankruptcy is not the only effective way to deal with financial hardship – for many, it is an alternative worth looking into. At the Law Offices of Paul L. Rubin, we offer a free consultation which will help determine whether bankruptcy is an option that can help you or whether some other steps would be more appropriate. It makes sense to talk to a bankruptcy professional before you go too far and start borrowing more money just to tread water.