“We spent too much, too fast,” commented William Moses, the third husband of socialite Patricia Kluge. The couple reported last week that they have filed for Chapter 7 bankruptcy in order to liquidate their assets to pay off nearly $50 million in debt.
Before the downturn in the economy, Floridians were confident in the real estate market and their independent business ventures. But when the housing market crashed, many were caught in the undertow and have since lost thousands or millions in their investments.
Many individuals across the U.S. who once had a sufficient flow of income to fund their lavish lifestyles have since fallen behind on payments and have defaulted on their loans. Moses commented, “We bought the best of everything.” But now the couple can no longer keep up with their lifestyle and they are drowning in millions of dollars of debt.
TIME reported that in 1990 Kluge was awarded $1 billion in her divorce from John Kluge. She became a socialite and made friends with other high-profile individuals such as Donald Trump. Over that past 10 years, she purchased a 776-acre vineyard in Virginia and spent $44 million on her business venture to make and bottle her own wine. The business did begin to take off, but the downturn in the economy hindered the business’s growth.
Now the woman who was once worth a billion has lost her 23,000-square-foot home to foreclosure. She has also been selling off her assets over the past 12 months in effort to pay off debts and to make ends meet. Last week, the couple finally filed for Chapter 7 bankruptcy and will continue to liquidate their assets.
The couple has reported $1 million to $10 million in assets. However, nearly $50 million is still owed in unpaid debts.
Many individuals may choose to hold off on filing for bankruptcy protection because they believe that they can fix their financial problems on their own or because they don’t want to face the reality that they may not be able to repay their debt. Florida residents who worry that their financial situations may only worsen should consider their options in order to find financial stability and to be able to live within their means once again.
Source
The Wall Street Journal: “Socialite and Wine Maven Files for Bankruptcy,” Jacqueline Palank, 21 June 2011