Joe* had not long retired. He formerly worked in a physical Job but could no longer do that. Joe is now on the single aged pension which is quite tight. He does not own any property and only has a cheap car. When we did Joe's budget, he still had nearly $30,000 in credit card debt. He needed to pay $250 a week to clear his debts. Under a debt agreement Joe may be able to get the payments down to as low as $100 per week, but after Joe pays his rent this would still leave him considerably short on living and car costs. Joe was not going to be able to obtain further employment or increase his income. Joe had no assets of any value and his situation was not going to change. He would have been in Financial Stress for the rest of his life, so in this case, it was best Joe become Bankrupt so he could at least have a basic living income.
* All Case studies are based on experience with actual cases. Names and some circumstances changed to protect the individuals privacy.