Chicago Bankruptcy Lawyer Blog

You may recall the "good 'ole days" when you could buy fruits and vegetables from a local farmer for pennies on the dollar, or getting a good deal from your local grocer during your weekly shopping excursion. Unfortunately, those days are over as food prices overall continue to soar.

Nowadays, consider yourself lucky if you're paying less than $100 a week for food, and if you have a large family, it's probably closer to $200. These bills, along with medical bills, credit card bills, increasing bank fees and other payments have caused many people to consider bankruptcy in Chicago.

Add in high unemployment, a stumbling economy and the high cost of fuel, and it may be time to talk with an experienced Chicago bankruptcy lawyer. While bankruptcy isn't for everyone, it may be right for you.

Bankrate.com offers these tips on how to cut back on your food shopping bill.

Look at the packaging: Companies have been trying to fool consumers for a long time by selling the same product but in smaller boxes. Take a look at cereal boxes, for instance. They used to be huge. Now, they're a lot smaller, some down to eight ounces, which isn't much when you're trying to feed a family. And of course prices haven't shrunk as the size of the boxes have. One thing you can do is check the "price per unit" label. That's the true value of the product so you can determine whether you're getting a good deal or you're getting scammed. You can also save considerable dollars in some cases by buying a different brand.

Where's the beef?: The price of beef and pork has increased dramatically in the last year -- 11.5 and 7.3 percent, respectively. The cost of fish -- largely based on natural disasters in Japan, a fishing-heavy country -- has also spiked. Consider spending less on these items and more on chicken or turkey, both of which have remained less expensive over the past year. Wait until beef and pork prices dip.

Stay in for dinner: Restaurants typically charge a lot while not providing a whole lot of bang for the buck. While eliminating eating out may not work for your family, consider how much you're spending. Look for coupon apps if you have a smartphone, and research websites that offer half-off or more on dining certificates. Also consider drinking glasses of water or sharing meals with your family or guests.

Only eat in-season fruits and veggies: Grocery stores pay high dollar for out-of-season fruits and vegetables, and guess what -- they pass the cost on to you. If you're jonesing for strawberries in December, try to hold off until summer when the cost drops.

Be frugal: Be a coupon clipper and don't be embarrassed. Also, look for weekly deals, shop around when practical, and buy generic instead of name-brand products. Smart shoppers are finding savings every day.

Continue reading "Grocery Bills, Other Bills Add Up, Leading Some to Consider Chicago Bankruptcy" »

For people mired in debt, saving money sounds like an impossible goal. But a recent study found that keeping things simple and saving for one specific goal may be effective, reports MSNBC.com.

As Chicago bankruptcy lawyers reported recently, 1 in 4 consumers don't have any emergency savings and couldn't afford a $1,000 repair in a pinch. While that's not shocking given our current economic climate, it is concerning. What it means is that people are likely living off their credit cards to get by, which is a dangerous situation to be in.

People are hurting financially and while savings may be a great thing to think about, those in debt may not be able to consider it. But imagine if there was a time during which you could store away money in savings, in the stock market or in retirement to plan for the future instead of wondering how to get by today?

That's possible with a Chicago bankruptcy. Through this process, a person's debts can be cleared, which allows them to start fresh and get back on track without the headache of creditors calling and lenders angling for payments.

With the debt gone forever through these consumer protection laws, the person can start over and begin putting away for the future. It can be a freeing experience for those who have lived for years with high interest rates, low credit scores, hidden fees and minimum credit card payments.

According to the news article, a new research paper out of Toronto found that people did better at saving if they had one goal, instead of several goals that may be more difficult to obtain. What researchers found is that when people are told that it is important to save for a number of things -- a new house, car, college fund or other goal -- they try to prioritize which is most important and end up not doing well at putting away for any of them.

But on the other hand, if a person has one goal -- just the new addition to the house or the vacation -- it can be easier to implement it. The researchers found that people from different countries and different walks of life respond similarly to saving money.

An informal poll on the news web site shows that voters were split nearly evenly about how best to save money:

Having one simple goal, like going on vacation -- 33.7%
Having a few goals, like buying a house, sending the kids to college and retiring -- 32.8%
Saving money? That's a pipe dream these days -- 33.5%

Ask yourself where you fit among those three options. If you couldn't consider saving money because you're struggling with debt payments, consider meeting with a Chicago bankruptcy lawyer who can help you determine if you qualify for bankruptcy, what the process is like and how going through it can help your life in the future.

Continue reading "Can You Save Money in Chicago or is Bankruptcy an Option?" »

The banks keep making it more and more difficult for many people in Chicago who are simply trying to get by.

First, the banking industry's sub-prime mortgage debacle is largely to blame for the biggest financial decline in the last 100 years. Now, they have decided that the way for them to recover all that lost money is to fine their customers for doing business with them.

While it makes little sense on the surface, it may work unless consumers fight back by doing business with other banks or, better yet, credit unions. And although bank fees increasing this year may not cause someone to file for bankruptcy in Chicago, it is another signal of the difficult times consumers are experiencing.

While bankruptcy may not be appropriate for every consumer, Chicago bankruptcy lawyers have helped many people who are scrambling to find answers to their troubling financial situation.

CNN Money reports that Citi is the latest large bank to announce it is taking its customers for granted by hiking fees on checking accounts and banking accounts. According to CNN, the bank will charge its mid-level Citibank Account members $20 a month -- $240 per year -- if their minimum balance drops below $15,000 in their combined accounts. The previous threshold was $6,000.

For EZ Checking customers, the $15 per month fee will be imposed if they don't have $6,000 in their account. That's because Citi is trying to phase out EZ Checking, which has no current monthly fee, and move people into Citibank Account or Basic Banking account features. Of course both of those options have fees already in place.

Its Basic Banking account fee went from $8 to $10 per month, unless customers have at least $1,500 in their account or make one direct deposit and one automatic online payment through their checking account each month. The trade-off is that current account holders have to make five online transactions monthly but are not required to have a minimum balance.

Citi's announcement comes as other banks have announced recent hikes in fees. Bank of America, Wells Fargo, JPMorgan Chase, Sun Trust and Regions have all added fees in recent weeks. Some have begun charging for debit card transactions as well.

With legislation that cut back how much banks are allowed to charge on a per-swipe basis at the point of sale, they have looked to make up the money elsewhere -- with consumers being the target.

It's sad that banks have chosen to treat their customers that way, but it's nothing new. They may be taking pointers from credit card companies that impose significant fees and outrageous interest rates in order to make money.

Add that to the climbing cost of living in America and it's no wonder bankruptcy in Chicago is an option many are considering. Consider a free consultation to see if it's a fit for you.

Continue reading "Bank Fees Taking a Toll on Chicago Consumers Considering Bankruptcy" »

A savings account may be a luxury for many people trying to save money for their future, but for many Chicago families, saving money isn't as feasible as it once was.

With the economy struggling to recover and people dealing with job loss, high-interest loans and credit cards that have kept them buried in debt, filing for Chapter 7 bankruptcy in Chicago may be a sound option.

Filing for bankruptcy immediately stops creditors from calling and attempting to garnish wages and otherwise making life difficult. So, if a consumer is drowning in debt brought on by job loss, mounting medical bills, or predatory lending practices, consulting with an experienced Chicago Bankruptcy Attorney would be a smart move.

According to a recent survey, more parents are saving for their children's college education, but the rising costs of higher education, coupled with additional pressure from the poor economy, are hurting the future value of those savings.

The survey, conducted by Fidelity Investments, found that 67 percent of parents have started putting money away for tuition costs. That's a 9 percent jump from a 2007 survey, the first year the survey was done.

But more than half of parents who were surveyed are still paying off their own student loans and half are also paying an average of $576 per month for preschool or daycare. About 40 percent are paying for those obligations along with a college fund for their kids, too. That has increased 27 percent from five years ago.

Because of increasing college costs and people less able to save money, Fidelity believes the average American family will be able to pay for about 16 percent of college costs, based on savings. In the last five years, that number has dropped about 8 percent, while college costs have jumped nearly 26 percent.

The percentage of parents who believe it is their responsibility to pay for their kids' college has increased, and many are taking extra jobs to pay for the added expense. Some parents are asking their teens to take part-time jobs, live at home and commute, and consider public universities over private schools.

What this study shows is how the economy has affected the average household. Savings are a great thing to have, but many people are forced to decide between putting away money for junior's college fund or paying off the expensive purchase that now costs twice what the sticker price was because of high interest rates levied by credit card companies.

Saving money can sometimes take a back seat when bills are mounting and a family is getting behind making payments. Family members must make difficult choices, and for those who are absolutely devastated by debt, saving money is just not going to happen. For those people, bankruptcy could work.

Filing for bankruptcy halts all debt collection practices, including foreclosure, wage garnishment and collectors calling. It allows for consumers who have overwhelming debt to get a fresh start with their finances after the IOUs disappear.

Continue reading "College Savings Takes a Hit in Weakening Chicago Economy" »

The old saying goes that the only things guaranteed in life are death and taxes.

Well, add bills to that expression because we all know that hardly a day goes by without most of us receiving some kind of bill or invoice. Think about car payments, mortgage or rent payments, credit card bills, medical bills, insurance fees and more.

Add childcare fees to that seemingly never-ending list. A recent story on CNNMoney states that the cost of child care has risen by leaps and bounds during the past decade. Parents are struggling to pay for daycare and babysitting duties while they continue to work in order to provide good home, food on the table and other necessities.

Some may consider how filing for bankruptcy in Chicago can give families a good amount of relief from debts as they tackle bills that require cash. For families with expensive childcare bills, consulting with an experienced Chicago bankruptcy lawyer to discuss the options should be on the list of priorities.

The story states that the average cost of raising a child up to age 18 averaged about $226,920 in 2010 for middle-income, two-parent families. That's up 40 percent from 2000, when the average cost was $165,630.

Experts say that simple cost-of-living expenses have lead to the spike in childcare costs. Everyday tasks such as buying groceries, paying for gas, and covering basic child-rearing expenses -- diapers, baby food and clothing -- have also been skyrocketing.

Of the $226,920 it takes on average to raise a child, this is the average breakdown in costs:

• Housing: $69,660


• Child care/education: $39,420


• Food: $36,210


• Transportation: $30,900


• Misc: $19,110


• Health care: $18,420


• Clothing: $13,200

The transportation organization AAA reports that transportation costs -- with the rise in gas costs -- have squeezed consumers by about 85 percent more in the last decade. With companies scaling back on jobs and even medical and healthcare benefits, it has taken a toll on parents to come up with the extra cash.

Analysts have found that childcare costs have soared to heights unseen before. For some, they pay more for child care than the mortgage or rent on their home. And if parents don't pay for child care, they can't work, so it's not a flexible bill.

This sometimes leads parents to fall behind on other bills in order to pay for childcare service. They sometimes take second jobs or work longer hours, if possible, to make more money to keep the household running smoothly. This may lead to more income, but it also leads to parents and children roaming farther from each other and can cause a stressful situation.

Some parents have bills they consider to be "flexible." But those are the ones that can come back to haunt them, as credit card companies use hidden fees and high interest rates to hit consumers hard when they least expect it.

This is where bankruptcy in Chicago can come into play. By eliminating debts and having bills wiped clean or at least driven down, bankruptcy can allow parents to focus on the most important bills, like day care, school activities and family enrichment. All the things that can truly benefit your kids.

Continue reading "Rising Childcare Costs Lead Families to Consider Chicago Bankruptcy" »

Recently, the Federal Reserve laid out a not-so-heralded plan to boost the economy by driving down long-term interest rates in order to stimulate the economy.

But the plan only works if borrowers take out loans now, which sends them into debt. Even with low interest rates, this situation can be a challenge to overcome. In fact, investors didn't respond well to the plan, with the stock market largely in a sell-off in the days after the announcement was made.

Let's be clear here, though -- credit is a necessary function of our society. Most people don't have $15,000 to $20,000 to buy a new car. And very, very few people have $150,000 in cash to purchase a new home. So, it's obvious that banks and lenders are needed in order for our society to function.

However, what usually happens is that people are forced into bankruptcy in Chicago because of the lenders' hidden fees and ridiculously high interest rates. This can leave a borrower actually paying a lot more than what the item or service is worth. Chicago bankruptcy attorneys have seen time and time again many consumers who have been taken advantage of by lenders.

While low interest rates are beneficial to those who must take out loans to make purchases, they can still add up over time.

According to a recent USA Today article, the $400 billion that the Fed shifted may actually have a low impact on consumers. They may end up getting lower rates on mortgages and fixed-rate loans, yet those holding long-term bonds may seen interest income dip as a result.

Because of the nation's high 9.1 percent unemployment rate, the move is unlikely to provide long-term improvement. Some experts say the impact on consumers will be minimal. Here are some areas where consumers may see changes:

Mortgages
Mortgage rates are a focal point of the national bank's plan. The $400 billion in short-term Treasury bonds will be used to buy long-term Treasury bonds by next summer. The money will be reinvested from mortgage-backed securities to help mortgage rates stay low.

Interest rates are already low -- 4.09 percent on a 30-year, fixed mortgage -- so it's not interest rates that are the problem. Consumers are nervous about the housing market and are unwilling to invest.

Consumer Debt
Most people's credit card rates are tied to prime rate, so the Fed's plan could keep credit card rates lower at least until 2013. Yet, some analysts say the prime rate isn't based fully on federal funds, but is also determined by the rates at which banks lend each other money and on the market.

So, if the economy and stock market continue to slump, rates could end up rising.

The article goes on to say that those holding long-term bonds will suffer under the Fed's plan, including retirees hoping to benefit from interest rates later in life. This includes insurance companies, which are heavily invested in bonds. These companies could raise rates to make up for lost income there. Short-term savings and the stock market also will be affected.

Most people hope that the Fed's plan works to help this country get back on track. But most people don't have a strong feeling that it will.

Continue reading "Fed Plan Could Lead Chicago Consumers Into More Debt" »