Bank­ruptcy hits young

NT News - Real Estate - - Realestate Market Place - AN­THONY KEANE

YOUNG adults are go­ing bank­rupt at a record rate.

An ex­plo­sion in easy ac­cess to credit, on­line ser­vices and buy now-pay later schemes is caus­ing snow­balling debts among young peo­ple.

Many don’t re­alise that a bank­ruptcy leaves a per­ma­nent black mark and could stop them trav­el­ling over­seas.

A new anal­y­sis by credit agency il­lion has found that there were 784 bank­rupt­cies for 18-to-24-year-olds in the Septem­ber quar­ter, up from 123 just four years ago. In most states, young bank­rupt­cies are five times higher than they were in 2014. The chief ex­ec­u­tive of il­lion, Si­mon Bligh, said many young peo­ple had lit­tle or no sig­nif­i­cant as­sets to lose, so there were fewer in­cen­tives to avoid bank­ruptcy.

“More peo­ple are ac­cess­ing credit at a younger age, en­ter­ing fi­nan­cially bind­ing con­tracts for dig­i­tal sub­scrip­tion ser­vices to ac­cess mu­sic, movies, TV shows, on­line shop­ping and gam­ing ac­counts,” he said.

“Fi­nan­cial lit­er­acy among the young is poor, which is a key fac­tor be­hind debts snow­balling to the point where they be­come in­sur­mount­able.”

The 18-to-24 age group was the only bracket where women out­num­bered men for bank­rupt­cies, the anal­y­sis found. Over­all bank­rupt­cies for all Aus­tralians in the three months to Septem­ber 30 to­talled 7400, down 9.5 per cent. be­fore head­ing over­seas.

• They might have to make com­pul­sory pay­ments when wages ex­ceed a fig­ure.

• Peo­ple’s names per­ma­nently ap­peared on the Na­tional Per­sonal In­sol­vency In­dex pub­lic reg­is­ter.

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