Unless you have been recently hiding under a rock, you’ve heard about the Bedford man arraigned last week on espionage charges. Media organizations are frothing at any personal information they can get their hands on. One piece of public information that has surfaced is that he filed for bankruptcy in 1998.
Unfortunately, society still regards filing for bankruptcy as a character flaw. If you can’t manage your money, what can you manage? A responsible person, we are told, should know how to manage their finances. The years pass, bankruptcy levels rise and yet societal values remain somewhat unchanged.
With recent studies reporting Canadians spending $1.50 of every dollar earned, the face of bankruptcy is also changing. Let’s call them the “working poor”. The face of bankruptcy today is your neighbour, your co-worker, your child’s teacher, the hospital nurse, even the bank employee. The list goes on and on. Debt affects everyone nowadays. We are quick to criticize people who seek bankruptcy protection, however, often the true causes of bankruptcy have nothing to do with over-spending or poor money management. Illness, marital breakdown, a series of unfortunate events, reduced household income as a result of the death of a spouse, cessation of child support, or even temporary job loss can cause a person who has been living just at their threshold to get behind the eight ball enough that they never recover.
Most individuals have already been to their banks requesting a consolidation of their debts and have been turned away for a multitude of reasons, such as debt-ratio being too high, seasonal income, no co-signers or poor credit score. Many consumers resort to high-interest payday loan companies to bridge the gap.
The federal Bankruptcy & Insolvency Act affords an honest but unfortunate insolvent individual protection from creditors. Granted, there are always a few bad apples that spoil the bunch, but very few people WANT to file for bankruptcy. It is usually out of necessity.
The fact that someone recognizes a debt problem and seeks assistance for their financial circumstances should not been seen as a sign of weakness but rather a sign of strength. It takes a much bigger person to admit to a debt problem rather than hide from it.
Tags: Bankruptcy, Credit, family issues, insolvency act