Even though the great recession ended years ago, there are still a number of Americans struggling to get by. This is likely because they are still paying off debt that they accumulated when the economy crashed. New numbers derived from an ADP investigation finds that about seven percent of workers in the U.S. workforce are having their wages garnished.
More importantly, workers in their prime earning years (ages 35 through 44) are being garnished, and the amounts that come out of people's paychecks (up to 25 percent of their after tax earnings) arguably have had a significant impact on the nation's economic recovery.
Traditionally, garnishments were used to collect on back child support and tax arrears. However, more people are being garnished to pay old credit card debts, medical debts and student loans. Depending on where you live, the debt continues to grow with interest, late fees and even attorney's fees once the matter reaches the judicial system. So a $16,000 credit card debt could easily top $20,000 when all said and done. Overall, about 4 million workers experienced garnishments in 2016.
If garnishments are affecting your ability to make ends meet, a bankruptcy may be a way to eliminate debt and restore one's earning capacity. Bankruptcies stop all collection efforts. And depending on which chapter is chosen, the debt can be wiped away fairly quickly, or it can be repaid within a reasonable payment schedule.
The preceding is not legal advice. For questions about your individual situation, contact an experienced bankruptcy attorney.