Book an
Email
Directions
Despite recent positive data regarding consumer confidence, LegalShield saw a concerning rise in financial constraints in the December Consumer Stress Legal Index (CSLI). The result was a peak in consumers seeking out bankruptcy help and other legal assistance. The data for the index draws from more than 35 million legal service requests and is forecasting a dip in the previously optimistic consumer confidence.
This trend of consumers seeking help filing for bankruptcy showed a disproportionate impact on younger generations and reflects a potential credit crisis.
A report from Newsweek stated that this is reflected in the broader U.S. economy, as household debt rose 1.3% in the third quarter of 2023. The Federal Reserve Bank of New York attributes this to increases in mortgages, auto loans, credit cards and student loan balances.
As consumers take on more debt, they are beginning to look into options to relieve this financial burden. LegalShield reported that, year-over-year, there was a 24.7% increase in Gen X and a 40.1% increase in millennials reaching out for bankruptcy assistance.
“People don’t call attorneys unless they are genuinely worried about something,” LegalShield SVP of Consumer Analytics Matt Layton told Newsweek. “These are real concerns from real people who sought out affordable legal advice to take action.”
The December CSLI report at 66.7 was the highest it has been since November 2020, pointing to trends that contradict the otherwise optimistic economic reports as well as implications for consumer behavior. The Newsweek report indicates that as the Federal Reserve’s interest rate spikes are beginning to impact consumers and based on the data from LegalShield, those who already have significant debt burdens are going to experience an increase in financial distress and uncertainty.
If you are experiencing increased financial stress due to significant debt burdens and increased repayment amounts, bankruptcy may be an option to help you on your path to a more secure financial future. Contact a member of our team at Sader Law Firm today at (816) 561-1818 for a free phone consultation and information on what options will work best for you.
