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Health and Financial Benefits Of Chapter 13

Robert J. Adams & Associates May 4, 2015

The benefits of successfully completing a Chapter 13 are obvious such as reinstating a home mortgage or saving one’s car and being debt free upon discharge.

BUT, there is more.  A recent Harvard University study found:

  1. Annual earnings increase $5,000 in the first 10 years after filing;

  2. A 3.5% increase in employment over the first 5 years after filing;

  3. Close to a 3% increase in self-employment after filing;

  4. Reduced dependency on “welfare”;

  5. Increased retirement savings contributions;

  6. Reduced mortality by 2% probably from reduced stress.

The authors believe a successful Chapter 13 yields these positive effects because filers have an increased incentive to work and produce more earnings. People experience much reduced economic instability and stress which lead to all of the above benefits.

Another added benefit that is not included in the Princeton study: bankruptcy helps save marriages and relationships. One of the major causes of Divorce is Money trouble. I know from close to 40 years’ experience that the filing of Chapter 7 and Chapter 13 has saved marriages and relationships.

The above are averages and may or may not apply to you. But our clients generally feel a lot better when they file a Chapter 13 and when they get a Chapter 13 discharge.

To review the paper yourself, click here. To see if you can benefit from a Chapter 13 or Chapter 7 filing, please call Robert J. Adams & Associates.