Regardless of income, assets or career, virtually anyone can find themselves drowning under debt. For some people in Florida this may be difficult to believe, but whether its through the slow accumulation of smaller debts or a massive financial disaster, anyone can find themselves with more debt than they can repay. Popular rapper Lil’ Kim recently made this point clear when she filed for Chapter 13 bankruptcy.
Born as Kimberly Jones, Lil’ Kim filed for bankruptcy three days after her $2.3 million home was foreclosed on, stating that she was more than $664,400 behind on her mortgage. In her filing she also cited more than $4 million of debt that she cannot repay, which apparently includes the $1.5 million that the IRS claims she owes in back taxes. She also owes approximately $200,000 for unspecified legal fees.
Among her assets she listed multiple high-end vehicles and jewelry, which she valued at $25,000. Although it may be difficult to understand how a famous rapper could find herself deep in debt, the answer is one that many people are familiar with — an unexpected loss of income. In 2016, Lil’ Kim earned nearly $824,000. In 2017, she earned less than half of that, and reported her income as $398,000.
Most people in Florida plan their futures based on their current income level. Any change to that, such as a pay cut or sudden unemployment, can derail even the most carefully laid financial plans. However, Chapter 13 bankruptcy can be an effective solution to debt that has outpaced a person’s income. By reorganizing debt and setting individuals on a clearly defined repayment plan, most people can rebuild their financial security.