Unexpected events happen all of the time to Colorado residents. In some instances, it is possible to prepare and plan for certain events, in order to protect one's self in the event something occurs. In other cases, however, the event can surprise a person or may simply be too drastic to overcome, no matter how much preparation was done beforehand.
For example, when it comes to a person's finances, even the best laid plans can be turned upside down when a sudden event occurs that adds significant debt or detracts from a person's income. Many individuals must deal with the loss of a job, for instance, which makes it difficult, if not impossible, to pay the person's monthly bills without the flow of income. Others experience unforeseen health issues that can result in severe medical debt, which can cripple a person's financial health.
Businesses, too, are not immune from unexpected changes to their finances. Changes to the economy or to a specific business can leave the business with little choice but to file for bankruptcy.
For instance, one recent business bankruptcy occurred after a Colorado wolf sanctuary was dealt a bad hand because of the wild fires that burned about one third of the sanctuary's property. Due to the one of the worst fires in State history, the nonprofit sanctuary lost several sheds and storage facilities, in addition to dealing with flooding on the property because of the fire.
Given these unexpected consequences of the fire, the sanctuary incurred large cost increases that it could not absorb. Accordingly, in an effort to obtain debt relief, the sanctuary filed for bankruptcy.
The nonprofit is not alone, however, as many challenges, whether expected or unexpected, can plague a business's financial health. Businesses and individuals may find bankruptcy an effective way to overcome these challenges, as the bankruptcy can wipe out debts and provide a fresh start.
Source: The Wall Street Journal, "Wolf sanctuary in Colorado files for bankruptcy," Katy Stech, Oct. 15, 2014