Finding A Balance Between Income and Debt

On behalf of Trenton Grand of Grand Law Firm posted in chapter 13 bankruptcy on Tuesday, August 28, 2018.

Many young adults who live in the Baton Rouge area and other cities across the United States area are already in debt with a large percentage not being of the legal age to drink. This age group is known as Generation Z or those who are between the ages of 16 and 20. The average debt of these young adults is about $4,300. Young adults who are between 21 and 25 are in debt by about $11,000 each with the amount being higher if they don't have as much financial aid as others while attending college or if they attend a university that is a bit more expensive than others.

In regards to a savings account, it's usually not something that young adults have established yet. Those who are considered Generation Z are attempting to turn the financial world around and are attending college in order to have a career to make money. However, there is a large percentage of these young adults who don't really understand the ramifications that can come with financial independence and sometimes don't make good choices.

Some of the debt that Generation Z has is considered good because it's associated with student loans or mortgages. However, credit card debt is often considered bad because of the high interest rates that are associated with the cards. Total debt should be kept close to 36 percent of the total income as to not become overwhelmed by money that is owed compared to how much money is made each year.

When young adults face high debt levels, a Chapter 13 bankruptcy attorney can offer assistance. The attorney can examine the income to debt ratio to determine the best solution for the adult before filing any kind of formal paperwork to declare bankruptcy.

Related Posts: Rising consumer debt worries financial experts, The high cost of credit card minimum payments, The downside of carrying a credit card balance, Study suggests delaying bankruptcy could increase struggles

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