Median Household Income Plummets; Bankruptcy a Powerful Weapon for Kentucky Families

The Chicago Sun-Times and other major media outlets are reporting this week that household income has dropped faster since the end of the recession.

Louisville bankruptcy attorneys continue to help consumers deal with the fallout of the middle-class squeeze. Really, it’s no wonder protestors have taken to Wall Street. The AFL-CIO recently reported the average annual CEO pay at a S&P 500 company is $11.4 million. The pay of these few hundred executives totaled $3.4 billion and would have paid the median salaries of more than 100,000 workers. 80188_money_4.jpg

During the recession, the median household income fell by 3.2 percent to $53,518. From June 2009 to June 2010, it fell by 6.7 percent to $49,909. Self employed households suffered an 8.4 percent decline. African-American household income fell nearly 10 percent to $31,784. The youngest (25 to 34) and the oldest (62 to 64) fell by the largest percentage, 9.8 percent and 10.7 percent, respectively.

Too often, consumers don’t know where to turn when medical bills, bad mortgage debt and credit card debt have them backed into a financial corner. Chapter 7 or Chapter 13 bankruptcy in Kentucky can offer a fresh start. Bankruptcy remains the most powerful consumer protection law on the books; families that have been squeezed to the breaking point should seek the advice of an experienced bankruptcy law firm.

Bankruptcy will stop foreclosure and collection efforts, including garnishment of wages. It will immediately stop creditors from harassing you. Together with your attorney you can review your financial situation and decide upon the best course of action. For about three-quarters of those who file, Chapter 7 is the best option. This filing will eliminate most unsecured debt. Consumers may even be able to keep their home or car if it makes financial sense. Retirement accounts are protected.

For those who need a financial breather and time to regroup, Chapter 13 will establish a payment plan over 3-5 years. It will keep creditors off your back and permit you to prioritize your debt. It may also be used by consumers who do not qualify for Chapter 7. Those filing for Chapter 13 can keep large assets while making arrangements to satisfy debts.

In either case, filing for bankruptcy has become a primary weapon in the middle-class fight to stay afloat. We encourage you to be proactive. If bad debts are preventing you from saving for college or retirement, of if bill collectors are impacting your quality of life, please pick up the phone and get the legal help you need to secure a brighter financial future.

If you need to speak to a Kentucky bankruptcy attorney or Louisville foreclosure defense firm, contact the Schwartz Bankruptcy Law Center at 866-270-4495 for a free and confidential consultation to discuss your rights.

Additional Resources
Median income has shrunk faster since recession ended, By Sandra Guy, Chicago Sun-Times.

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