Utah, the Nation's Bankruptcy Capital

Congress recently passed the Bankruptcy Abuse Prevention and Consumer Protection Act, designed to minimize frivolous bankruptcy filings and to require debtors to repay some of their debt. Once it takes effect in October, 2005, the law will make it harder for those with problem debt to have their debt wiped away by the courts. Most will have to agree to a five-year repayment plan. In passing this new law, members of Congress suggested that our bankruptcy courts are filled with cases involving not ordinary citizens, but with reckless gamblers, shoppers, and drug abusers. Is that really the case?

One would think, given the accusations, that the highest bankruptcy rate in the Untied States would be in place where such vices were common, such as California, New York or even Nevada. If problem gambling is thought to be the cause of so much bankruptcy, then one might assume that Las Vegas would be the bankruptcy capital of the world. How odd it is, then, to discover that Utah, one of only two states that prohibits gambling completely, has the highest per capita incidence of bankruptcy filings in the United States. Utah? How can that be?

Utah has a number of aspects that, taken on their own, don't suggest that bankruptcy would be a problem. Added together, however, these things create a recipe for disaster:

  • Utah has the nation's highest birthrate. Seventy percent of the citizens of Utah are members of the Church of Jesus Christ of Latter-Day Saints, and members are encouraged to have large families. It costs more to feed, clothe and house a large family than a small one.

  • Utah has more families with only one wager earner. Large families mean more stay-at-home moms, so a lot of families must get by on a single paycheck.

  • Utah's wages are lower than average. Many high tech companies have relocated to Utah in recent years, but the "high tech" jobs they provide are often telephone customer service jobs, which typically pay $8-10 per hour.

  • Members of the LDS Church are expected to tithe 10% of their income to the Church.

  • While Utah's home prices are not among the highest nationally, they are fairly high when compared to the average wage within the state.

    • The combination of large families, fewer workers per family, church donations and low wages have contributed to an economic environment that makes it very hard for many Utahns to stay afloat financially. This is in direct contrast with the arguments put forth by Congress when the new bankruptcy law was proposed, which suggested that most people filing for bankruptcy are simply irresponsible. For many hard-working people in Utah, the new law will make it harder than ever to make ends meet.

    ©Copyright 2005 by Retro Marketing.

    Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation and credit counseling, and StructuredSettlementHelp.com, a site devoted to information regarding structured settlements.

    More Resources

    Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting

    More Debt Relief Information:

    Related Articles

    You Can Make Financial Resolutions Anytime
    The New Year often brings with it a desire to right the wrongs in yourlife. From this desire springs the tradition of New Year resolutions.
    5 Methods Toward Reducing Your Debt
    Decreasing your debt is paramount to having a good credit rating as well as giving you peace of mind. You want to get out of debt, but not all debt reduction options may be beneficial.
    The 5 Secrets to Getting Out of Debt Fast
    As they stare down at a teetering pile of bills, so many consumers wonder how they racked up such a large debt. The answer boils down to simple mathematics.
    Debt Elimination 2
    The First Step To Debt EliminationRegardless of your personal and financial circumstances, your education and your background, the chances are the first step you need to take in debt elimination has to take place in your mind. The Western mindset, especially in the US and UK, is firmly fixed on consumer debt.
    The Effects of Consumer Debt
    Consumer BorrowingConsumer borrowing in the UK has now crashed through the £1 trillion barrier. 80% of this is due to credit card borrowing, loans and mortgages.
    Use A Debt Checklist To Examine Where You Are
    A Debt Checklist allows you to look at items and areas of your financial life. You need toexamine these to gauge how you stand.
    Bankruptcy - The Easy Option?
    Incredibly, since the changes in the bankruptcy law in April 2004, debtors are more likely to petition for their own bankruptcy rather than their creditors! You would think that most people who have been threatened with the prospect of being made Bankrupt would be riddled with fear of the possibility. It is more widely referred to as the "Big B" rather than the dreaded word itself.
    Utah, the Nation's Bankruptcy Capital
    Congress recently passed the Bankruptcy Abuse Prevention and Consumer Protection Act, designed to minimize frivolous bankruptcy filings and to require debtors to repay some of their debt. Once it takes effect in October, 2005, the law will make it harder for those with problem debt to have their debt wiped away by the courts.
    Credit Repair - Understanding The Basics
    What is Credit?Credit means that you are using someone else's money topay for things. It also means that you are making a promiseto repay the money to the person or company that loaned youthe money.
    Top Ten Reasons People File for Bankruptcy
    1. Eliminate the legal obligation to pay many of your debts.
    Life on a Debt Management Program
    Signing up for a debt management program is easy; it's a matter of finding a company you feel comfortable with that is difficult. There should be no pressure added from the company you speak with, joining a DMP is your decision and you should feel like you are in a partnership with the company, meaning you both have control over your financial situation.
    Debt Collectors; And what you can do to Get Them Out of your Life
    FTC opinion letter on validation Section 809(a) of the FDCPA, 15 U.S.
    Learn The 15 Debt Elimination Steps You Must Take Immediately!
    What Everybody Needs To Know..
    IVA Information
    If you're thinking about an IVA, it is essential to get the best information possible. This is because although an IVA can be a manageable way to resolve your debt problems, it can also represent a commitment of up to five years.
    How to Choose a Debt Settlement Company
    As consumer debt continues to spiral out of control, debt relief is fast becoming a major concern for many American's. In 1999, American's made $1.
    Debt Handling Solutions
    Sometimes debt can seem overwhelming. In those instances, or even before things get that far out of hand, get back to basics and try some of these debt handling solutions.
    Benefits and Drawbacks of Bankruptcy
    Outlined below are some of the benefits and drawbacks of bankruptcy. It should be noted that bankruptcy is not to be entered into without first having sought professional advice.
    Getting Past The Idea Of Budgeting & Saving Money
    I'm sure you'll agree that budgeting, saving money, and eliminating debt are very appealing ideas. If effectively tackled, these goals can secure your financial status for the future, and allow you to live a comfortable, debt-free life.
    Personal Debt Reduction Practices
    Personal debt reduction practices, the steps people take to relieve the debt in their lives and to become more financially free, are a hot topic among financial circles. American spending habits are producing more people who are deeper in debt rather than people trying to achieve financial freedom.
    What You Should Know About Bankruptcy
    Filing bankruptcy is not only a last resort legal action; it is also a very complicated legal action that definitely needs the expertise of a lawyer. When thinking about bankruptcy, you first need to decide if bankruptcy is right for you.