Top resolutions for 2020: Take care of debt

Many people keep the tradition of making a resolution each year on New Year’s Eve. That way, they can make a change in their life and get a fresh start for the new year.

In the past, the most common New Year’s resolutions often included losing weight, exercising and eating healthier. However, that changed this year, with many more people resolving to reduce their financial stress.

Relieving debt was the top resolution for 2020

The most common resolutions for 2020 all revolved around personal debt. According to CNBC, a survey conducted by Fidelity Investments found that:

  • 51% of people surveyed want to pay down their debt;
  • 84% of people surveyed chose to reduce their debt and save $5,000 instead of losing five pounds or reducing screen time;
  • 28% of people reported that they added to their debt in 2019; and
  • 24% of those surveyed faced unexpected costs, such as medical expenses, that contributed to their debt.

With these resolutions, it is safe to say that many people in New Mexico and across the country will be looking for options to help them relieve their debt this year.

Focus on debt increasing, but bankruptcy filings have declined

Meanwhile, the rate of bankruptcy filings has slowly been falling since 2011. The United States Courts found that between 2018 and 2019, bankruptcy filings fell by 0.9% in March and 0.3% in June.

Many people might see the declining rate of bankruptcy filings as a good sign. Perhaps it could mean that individuals have a good grasp on their finances as well as their debt.

However, the 2020 resolutions seem to indicate that, unfortunately, many people are still struggling with debt. In 2018, CNBC reported that the average American held roughly $38,000 in personal debt. This number does not include mortgage debts, and it has almost certainly increased over the last year.

How could bankruptcy help with these resolutions?

Filing bankruptcy could help individuals facing overwhelming debt to achieve their resolutions. Bankruptcy is a constitutional debt relief process which:

  • Stops creditor calls and harassment;
  • Can discharge a significant amount of debt, depending on the chapter individuals file;
  • Requires counseling that can help individuals prepare for a healthy financial future;
  • Often protects an individuals’ property from debt collectors through the bankruptcy exemptions; and
  • Helps individuals manage their debt and obtain a fresh financial start.

While filing bankruptcy might not be right for everyone, the different chapters of bankruptcy have a lot to offer to help individuals resolving to reduce significant debt in the coming year.