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Choosing bankruptcy can help address Washington residents' debts

With trillions of dollars in debts, maxed-out credit cards and missed bills, the state of Washington residents' financial outlook is not exactly optimistic. Critics tend to disparage debtors, claiming that people simply need to learn to live within their means. While it might be nice to envision a simple reason behind ballooning debt, such a vision does not make it easier for those who are considering choosing bankruptcy because of suffering from student loans, hefty mortgages and medical bills.

Perhaps not surprising to some, student loans are now the leader when it comes to non-mortgage debt. Student loans quickly outpaced credit cards and car loans as the rising cost of earning a secondary education continues to skyrocket. Still, credit cards and car loans are not exactly stagnant. The outstanding balances for both of these types of debt have also begun to rise over recent years.

Housing costs are also rising as the economy continues to recover from the recession in which an untold number of Washington households suffered drastic financial hits. On average, each household in the country has nearly $170,000 in housing debt. This amount is simply unsustainable for a great many families.

While an average of $16,000 in credit card debt per household is certainly troubling, it is minuscule in comparison to the average $48,000 in student loans. As housing and education costs continue to climb, creating a solid financial platform on which to live is becoming increasingly difficult if not impossible. Obtaining an education in order to achieve a better paying job often comes with the downside of higher student loan payments, which can lead to vicious cycles of debt. Debt relief might seem impossible in these instances, but, for most people, choosing bankruptcy can be an effective strategy to handle and minimize the impact of debt.

Source: Slate, "Five Charts That Show Americans Families' Debt Crisis", Chris Kirk, May 12, 2016

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