When you think of an individual filing for bankruptcy, you might imagine an older adult with a house, many assets, and a family. However, the truth is, more and more young adults are facing financial difficulties and turning to bankruptcy as a means of starting over. But why are those in this age group struggling, and what options are available to avoid this outcome? To better understand this phenomenon and the solutions at your disposal, consult the guide below.

Why Are Millennials Filing for Bankruptcy?

There are many financial habits and obstacles young people face that lead to a need for bankruptcy. First, there’s debt. Many students struggle with student loans, which can create significant overhead costs each month. As such, they might start to rely on credit cards to cover other expenses, which could lead to spending beyond their means. 

Another common reason for money troubles as a millennial is a lack of financial education. Many young people don’t recognize the importance of putting money away or understand how to do it, leading to unexpected depletions when emergencies arise. 

How Can Millennials Avoid Bankruptcy?

If you’re concerned about filing for bankruptcy, there are some steps you can take to minimize the constraints and improve your financial health. First, if you’re struggling to meet your student loans while still paying other bills, consider refinancing your debt. While this will increase the length of time it takes to pay off the loan, it might decrease your monthly obligation and give you more room to save. 

Next, try to create a monthly budget, so you see exactly where your money is going. This will prevent overspending and help you find areas where you can cut back. Also, set up a savings account at your local bank. A savings account will grow with interest over time, giving you an easy way to slowly build a security nest. Plan to take a small portion of each paycheck and put it away toward your savings, so in the event of an emergency, you have something to fall back on. 

If you need to file for bankruptcy, talk to the professionals at Lein Law Offices. Serving clients throughout the Hayward and Winter, WI, areas, these lawyers have over 25 years of experience handling a broad range of legal cases. Visit their website to learn more about their practice, and call (715) 634-4273 to schedule a consultation today.