Florida residents might be surprised or even confused when they hear about celebrities, professional athletes, or politicians seeking bankruptcy protection. How can those who have great financial means end up in desperate positions?
The truth is, there are a number of things that can cause a person to become overwhelmed by mounting debt and bills. Even the most financially savvy and stable consumers are not immune from incurring unmanageable amounts of debt. A bad investment or a sudden serious illness, for example, can wreak financial havoc for many Floridians.
At the end of the year, Eddie Montgomery of the country band Montgomery Gentry file for Chapter 7 bankruptcy relief. Country music fans know that Montgomery Gentry is very successful, having garnered numerous Grammy nominations for various hits over the years. So, how did a member of this duo end up so deep in debt?
Montgomery incurred millions of dollars in debt after a restaurant venture failed. He opened a steakhouse with his wife in 2009; the couple has since divorced and the business has failed. According to his bankruptcy filing, Montgomery currently has $1.9 million in assets and $13.4 million in debt. Much of this debt is related to the restaurant.
Bankruptcy is often a necessary form of debt relief in the aftermath of a failed investment or a business closure. Such events often result in debt that individuals simply cannot sustain. Chapter 7 bankruptcy may allow for the discharge of debt linked to failed business ventures, so that individuals can emerge with a clean slate.
Source: Taste of Country, "Eddie Montgomery Files for Bankruptcy," Christina Vinson, Jan. 3, 2014