Getting a college diploma might not be quite the guarantee to a great paying career that it used to be. A brand new study indicates that the quantity of college educated people filing for bankruptcy has increased by twenty percent during the last five years. The age and income of filers has also risen.
Obtaining a graduate diploma no longer means you will have a job
The report, released Tues by the Institute for Financial Literacy, showed that the quantity of bankruptcy filers with a graduate diploma climbed from 11.2 percent in 2006 to 13.6 percent in 2010.
Individuals without a university diploma make up 70 percent of all bankruptcy filers. There was a greater rate of people filing that had any diploma though. This is compared to years before. Those with just a high school education have a higher chance of filing. These individuals make up for about a third of all filings done.
Leslie Linfield is the Institute for Financial Literacy founder. She said:
"There's these mythologies out there that if you go to college and you get a degree, you're going to do financially better. I think this data is starting to erode at this myth. ... The Great Recession has had a dramatic impact on the bankruptcy filings of American consumers across the economic spectrum -- including college-educated, high-income earners."
Not a small study
There were more than 50,000 debtors in courses for bankruptcy credit counseling or cash management from 2006 to 2010. Its reason was to track bankruptcy statistics following the 2005 Bankruptcy Abuse Prevention and Customer Protection Act. President George W. Bush signed the BAPCPA. This was done so those who were filing bankruptcy could possibly be controlled just a little bit better.
Looking at ethnicity
"While less educated, low-income individuals continue to represent the typical bankruptcy filer," Linfield said, "this report underscores a sophisticated evolution of the profile of the American debtor that now extends to disparate age, income and ethnic groups."
In 2006, those between 35 and 44 accounted for much of the filings. It changed to be between ages 45 and 54 last year. This is a huge risk, Linfield notes. "At 54," she asked, "do they really have enough time in front of them to start over?"
About 66 percent of filers made less than $60,000 a year.
There was a huge increase for Asian Americans. It increased to 4.5 percent from 2.1 percent. There was also an increase from 6.5 percent to 8.7 percent in Hispanic filers. A decrease from 15.4 percent in 2006 to 2010's 11.3 percent was shown for African-Americans. This shows a large decline in numbers.
Over-extended credit and job loss
Linfield explains that there is a cause of this enormous increase in statistics. It is due to the job loss. Consumers responding to the study cited over-extended credit, career loss and reduction of income more than any of other reasons as the causes of their financial turmoil.
There was an increase in the quantity of bankruptcies filed in America last year. They went up 1.5 million, the New York Daily News reports.
Obtaining a graduate diploma no longer means you will have a job
The report, released Tues by the Institute for Financial Literacy, showed that the quantity of bankruptcy filers with a graduate diploma climbed from 11.2 percent in 2006 to 13.6 percent in 2010.
Individuals without a university diploma make up 70 percent of all bankruptcy filers. There was a greater rate of people filing that had any diploma though. This is compared to years before. Those with just a high school education have a higher chance of filing. These individuals make up for about a third of all filings done.
Leslie Linfield is the Institute for Financial Literacy founder. She said:
"There's these mythologies out there that if you go to college and you get a degree, you're going to do financially better. I think this data is starting to erode at this myth. ... The Great Recession has had a dramatic impact on the bankruptcy filings of American consumers across the economic spectrum -- including college-educated, high-income earners."
Not a small study
There were more than 50,000 debtors in courses for bankruptcy credit counseling or cash management from 2006 to 2010. Its reason was to track bankruptcy statistics following the 2005 Bankruptcy Abuse Prevention and Customer Protection Act. President George W. Bush signed the BAPCPA. This was done so those who were filing bankruptcy could possibly be controlled just a little bit better.
Looking at ethnicity
"While less educated, low-income individuals continue to represent the typical bankruptcy filer," Linfield said, "this report underscores a sophisticated evolution of the profile of the American debtor that now extends to disparate age, income and ethnic groups."
In 2006, those between 35 and 44 accounted for much of the filings. It changed to be between ages 45 and 54 last year. This is a huge risk, Linfield notes. "At 54," she asked, "do they really have enough time in front of them to start over?"
About 66 percent of filers made less than $60,000 a year.
There was a huge increase for Asian Americans. It increased to 4.5 percent from 2.1 percent. There was also an increase from 6.5 percent to 8.7 percent in Hispanic filers. A decrease from 15.4 percent in 2006 to 2010's 11.3 percent was shown for African-Americans. This shows a large decline in numbers.
Over-extended credit and job loss
Linfield explains that there is a cause of this enormous increase in statistics. It is due to the job loss. Consumers responding to the study cited over-extended credit, career loss and reduction of income more than any of other reasons as the causes of their financial turmoil.
There was an increase in the quantity of bankruptcies filed in America last year. They went up 1.5 million, the New York Daily News reports.
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