Keeping up with rising costs of living on what are often stagnant wages can be difficult during the best of times, but add debt into the mix and the few people may make it out on the other side. Many South Carolina debtors are now struggling with burgeoning household debts in recent years. As non-mortgage debt continues to climb, bankruptcy may be the most sensible option for consumers who are struggling to keep up.
Mortgage debt still makes up the largest portion of household debt, and as mortgage and consumer debt is set to hit $15.7 trillion soon, mortgages account for $11.7 trillion of that number. So why are experts not focused on the mortgage side of things? Since 2008, household debt related to mortgages has actually dropped by over 5 percent. In 2008, the average mortgage ate up as much as 98 percent of a household’s disposable income. Now, that figure is only about 68 percent.
Consumer debt — which is comprised of debts such as credit cards, student loans, auto loans and more — is growing. Unlike mortgages, consumer debt has risen since the Great Recession, shooting up 45 percent in the last decade. Part of this increase is attributed to student loans, which are largely shouldered by younger consumers and comprise 42 percent of the nation’s consumer debt. Credit cards make up about 27 percent.
No one in South Carolina expects to need the protection that bankruptcy affords, but this is the reality for many consumers. Too much debt can place an incredible financial emotional toll on households, making it difficult to realize economic mobility or any other type of financial goal. Bankruptcy provides a solution to this problem by easing the burden on struggling individuals and guiding them toward a better future.