We've all been told that it pays to get a college degree. But perhaps it does not pay as well as it used to. A new study shows that the amount of university educated people declaring bankruptcy has increased by twenty percent during the last 5 years. The study also saw increases in the earnings and ages of filers.
No promise you won't fail with a graduate diploma
There was a rise from 2006 to 2010 from 11.2 percent to 13.6 percent of those with graduate degrees filing for bankruptcy as reported by the Institute for Financial Literacy report released Tues.
About 70 percent of filers are individuals that do not have a university degree. But the study showed that those with associates and bachelor's degrees also filed at a higher rate than in previous years. People possessing only a high school education make up about a third of all filings.
Leslie Linfield, creator of the Institute for Financial Literacy, said:
"There's these mythologies out there that if you go to college and you get a degree, you're going to do financially better. I think this data is starting to erode at this myth. ... The Great Recession has had a dramatic impact on the bankruptcy filings of American consumers across the economic spectrum -- including college-educated, high-income earners."
Huge study
The study was conducted from 2006 to 2010, involving more than 50,000 debtors in bankruptcy credit counseling or money management courses. After the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act, this survey was done to follow bankruptcy statistics. To be able to control those who were able to file bankruptcy, the BAPCPA was signed by President Bush.
Considering ethnicity
"While less educated, low-income individuals continue to represent the typical bankruptcy filer," Linfield said, "this report underscores a sophisticated evolution of the profile of the American debtor that now extends to disparate age, income and ethnic groups."
Most filings had 35 and 44 in 2006. When 2010 came around, those numbers changed. It was between 45 and 54 at that point. Linfield finds them particularly at risk. "At 54," she asked, "do they really have enough time in front of them to start over?"
The individuals made very little money too. In fact, less than $60,000 a year was what 66 percent made.
Asian Americans, whose numbers more than doubled, climbed from 2.1 percent to 4.5 percent. Hispanic filers, as reported by the report, increased from 6.5 percent to 8.7 percent. A decrease from 15.4 percent in 2006 to 2010's 11.3 percent was shown for African-Americans. This shows a large decline in numbers.
Over-extended credit and job loss
Linfield explains that there is a reason for this enormous increase in statistics. It is due to the career loss. The reasons cited by customers were job loss, reduction of income and over-extended credit.
There was an increase in the number of bankruptcies filed in America last year. They went up 1.5 million, the New York Daily News reports.
No promise you won't fail with a graduate diploma
There was a rise from 2006 to 2010 from 11.2 percent to 13.6 percent of those with graduate degrees filing for bankruptcy as reported by the Institute for Financial Literacy report released Tues.
About 70 percent of filers are individuals that do not have a university degree. But the study showed that those with associates and bachelor's degrees also filed at a higher rate than in previous years. People possessing only a high school education make up about a third of all filings.
Leslie Linfield, creator of the Institute for Financial Literacy, said:
"There's these mythologies out there that if you go to college and you get a degree, you're going to do financially better. I think this data is starting to erode at this myth. ... The Great Recession has had a dramatic impact on the bankruptcy filings of American consumers across the economic spectrum -- including college-educated, high-income earners."
Huge study
The study was conducted from 2006 to 2010, involving more than 50,000 debtors in bankruptcy credit counseling or money management courses. After the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act, this survey was done to follow bankruptcy statistics. To be able to control those who were able to file bankruptcy, the BAPCPA was signed by President Bush.
Considering ethnicity
"While less educated, low-income individuals continue to represent the typical bankruptcy filer," Linfield said, "this report underscores a sophisticated evolution of the profile of the American debtor that now extends to disparate age, income and ethnic groups."
Most filings had 35 and 44 in 2006. When 2010 came around, those numbers changed. It was between 45 and 54 at that point. Linfield finds them particularly at risk. "At 54," she asked, "do they really have enough time in front of them to start over?"
The individuals made very little money too. In fact, less than $60,000 a year was what 66 percent made.
Asian Americans, whose numbers more than doubled, climbed from 2.1 percent to 4.5 percent. Hispanic filers, as reported by the report, increased from 6.5 percent to 8.7 percent. A decrease from 15.4 percent in 2006 to 2010's 11.3 percent was shown for African-Americans. This shows a large decline in numbers.
Over-extended credit and job loss
Linfield explains that there is a reason for this enormous increase in statistics. It is due to the career loss. The reasons cited by customers were job loss, reduction of income and over-extended credit.
There was an increase in the number of bankruptcies filed in America last year. They went up 1.5 million, the New York Daily News reports.
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