Does holiday spending contribute to bankruptcy?

On Behalf of | Oct 30, 2019 | Bankruptcy

With the holiday season already gearing up, Connecticut consumers might be writing their gift lists and keeping an eye out for good sales. There is often a lot of pressure associated with the holidays, so many people feel the need to start getting ready early on. Unfortunately, that pressure can push some people even deeper into already difficult positions, leaving them drowning in debt. Even if this situation feels hopeless, bankruptcy could be an option.

According to a survey from Credit Karma, 43% of adults in America believe that it is impossible to survive the holidays without going into debt. This does not mean that people are happy about all that debt. More than half of the study participants said they would rather not buy gifts if that was an option. A total of 81% said that the main source of their holiday debt comes from purchasing gifts for loved ones. These results indicate that most people do not want to take on this type of debt, but feel that pressures from society and family make it impossible to survive this time of year without doing so.

Nearly half of adult shoppers believe they will end up at least $500 deeper in debt after buying gifts, purchasing food for holiday meals and participating in seasonal experiences. Others plan to take out loans to cover these expenses. While people might have the best of intentions when doing so, 90% of those taking out loans say they will do so in secret. The stress of keeping debt a secret from loved ones is not a seasonal problem, either. Of those who took on debt for the holiday season in 2018, 22% are still paying it off.

People in Connecticut go into debt for all kinds of reasons, and things like surprise expenses, unexpected medical bills and even holiday spending all contribute to growing balances and shrinking funds. It does not matter why a person got into debt, bankruptcy can still help. By filing for bankruptcy, a person can not only discharge debt from things like those unexpected expenses and medical bills, but also from holiday spending and unwise purchases.