According to an article in the Star-Telegram, Americans’ personal wealth has shrunk by $1.3 trillion putting American wealth at the level it was in 2004. Driven by job losses, shrunken 401(k) investments and foreclosures , many Americans are feeling little poorer.
The article said:
The value of Americans’ stock holdings dropped almost 6 percent from the final quarter of last year – in a market that was already brutal. Collectively, homeowners had 41.4 percent equity in their homes in the first quarter, the lowest on record dating to 1945, as Americans fell behind on mortgages or entered foreclosure. That was down from 42.9 percent in the fourth quarter.
As the wealth of some Americans becomes smaller, there are fewer assets to liquidate in case of a financial emergency. Less wealth means that Americans are more vulnerable to foreclosure, sudden illness and the affects of a job loss. Not only that, the retirement savings of workers are in jeopardy as Americans face choosing between paying the mortgage to avoid foreclosure or saving for retirement.
Many workers are choosing to liquidate their retirement in an effort to avoid foreclosure and in effect jeopardizing their future. Using retirement savings to pay current bills is at best a temporary solution. If you’re facing foreclosure or other financial issues and find yourself considering liquidating your retirement savings, you may need to consider discharging your debt instead. Contact a Dallas-Fort Worth bankruptcy attorney to learn if bankruptcy is the right choice for your situation.