According to registered bankruptcy trustee, Aravanis’ principal registered trustee Andrew Aravanis, it’s a misconception that bankruptcy is triggered by over-spending and poor habits.
He said it can happen to hardworking people who have fallen on bad luck, like a redundancy, bereavement or divorce.
The sudden financial burden can lead to more debt and financial difficulty. While there aren’t any trends around gender, home-ownership or employment type, there are some professions that have higher rates of bankrupt individuals.
Mr Aravanis said these professions are more likely to go bankrupt than any other, based on its own client base in 2017.
1. Managers (sales, marketing, PR, business administration, ICT)
2. Machine and stationary plant operators
3. Road and rail drivers
4. Business, human resource and marketing professionals
5. Health professionals (nurses and midwives)
6. Design, engineering, science and transport professionals
7. Construction trade workers
8. Other labourers
9. ICT professionals
10. Electrotechnology and Telecommunications Trade Workers
Mr Aravanis said the list shows those filing for bankruptcy may not share any commonalities.
“Although it is happening slowly, more and more Australians are realising that bankruptcy is actually a valid choice when faced with overwhelming debt,” he said.
“With more information on how to navigate bankruptcy and with the stigma fading away, thousands of Australians are choosing personal insolvency options like bankruptcy to help them to move on from an unmanageable financial situation and a highly stressful emotional position.”
Mr Aravanis said the myths of garnished wages, automatic sale of property and international travel bans are distorting consumers’ understanding of bankruptcy. He argued these myths are often started by “backyard experts” who are keen to share poor advice.
“This kind of misinformation adds an extra layer of difficultly for everyday Australians who need to make financial decisions while in hardship,” he said.
“Another issue we’re seeing is that people looking to file for bankruptcy are engaging online providers to help them complete their bankruptcy paperwork for a steep price!”
Mr Aravanis said consumers in financial difficulty need to remember they can access professional assistance for free.