Rising bankruptcy assistance among Gen newsweek.
In contrast to recently released positive economic data showing consumer confidence has increased 29% since November, Legal Shield’s December Consumer Stress Legal Index (CSLI) shows that consumers are It shows that the relentless rise in financial duress has reached a three-year peak as people seek legal help for insolvency and insolvency. Other legal assistance. Data extracted from more than 35 million legal service requests predicts a decline in consumer confidence and reveals rising financial challenges.
This trend disproportionately affects young people, points to underlying economic strains that cannot be fully captured by macroeconomic numbers, and suggests a credit reckoning could be in the near future. .
That is reflected in broader economic indicators. U.S. household debt is on the rise, rising 1.3% in the third quarter of last year to a record $17.29 trillion. The increase was driven by overall increases in mortgage, auto loan, credit card and student loan balances, the New York Fed said.
At least some of them are now facing bankruptcy and have sought advice from Legal Shield.
According to data from LegalShield, the number of millennials seeking bankruptcy assistance increased by 24.7% and Gen X by 40.1% compared to the previous year. Matt Layton, LegalShield’s senior vice president of consumer analytics, said the surge is creating friction with broader economic indicators, with 44-59-year-olds and 27-42-year-olds, respectively, facing impending This suggests that it could be the canary in the coal mine for credit problems.
“People don’t call their lawyers unless they’re really worried about something,” Leighton said in a statement. newsweek on mail. “This is not a survey with key economic questions or prompts. These are real concerns from real people who sought affordable legal advice to take action.”
The December CSLI report rose to 66.7, the highest level since November 2020, suggesting disturbing trends at odds with the optimistic economic report. Layton said the December peak completed a 10-month rally that would have a significant impact on consumer behavior.
LegalShield CEO Warren Schlichting said that despite the positive macroeconomic signs, the company’s data shows that “consumer debt issues, from bankruptcies to car repossessions, “We are concerned about the increase in the number of cases,” the statement said.
Legal Services data provides a real-time picture of some of the nation’s fiscal health, showing that the façade of a robust economy may mask serious debt and credit issues currently facing each generation. It suggests that.
“Our consumer stress legal index has historically led financial challenges by 60 to 90 days,” Leighton said. newsweek. “Increasing consumer stress, contrasted with increased spending, could point to an even sharper rise in household debt in the coming months.”
According to LegalShield data, the Fed’s interest rate hikes are starting to take off, as the CSLI increases coincide with the Fed’s interest rate hikes, and Gen I feel that I am in a precarious position.
If you are a Gen Xer or Millennial and are currently facing financial hardship, your experience matters to us. Share your story with Newsweek at personalfinance@newsweek.com and join the conversation about the financial realities facing our generation today.
Joshua Lott/Getty Images
rare knowledge
Newsweek is committed to challenging conventional wisdom, finding common ground and finding connections.
Newsweek is committed to challenging conventional wisdom, finding common ground and finding connections.
