Single mothers, who often work in low-wage jobs, are 50 percent more likely to file for bankruptcy than married parents, and three times more likely than childless couples, says Ms. Miller.
One divorced mother in suburban Chicago has refinanced her house eight times in 12 years and still owes $25,000 in credit-card debt, says Catherine Williams, vice president of Money Management International, a credit-counseling service in Houston.
About half of that debt, Ms. Williams says, is an accumulation of day-to-day expenses: "Johnny sits on his glasses, Susie loses her coat, and the price of gas goes up." Other expenses involve vacations and what Williams calls "compensation spending" to make up for the divorce.
"If she didn't have the equity in the house, she probably would have been bankrupt," Williams says.
When the woman asked if she should file for bankruptcy, Williams reassured her that she has the ability to repay the debt. The woman earns $32,000 and her former husband pays modest child support.
Williams, a financial counselor for nearly 25 years, does not think the new bankruptcy law will affect women too disproportionately because a means test takes income into account. "Those who will feel the biggest impact will be filers who have the income to repay the debt but just don't want to," she says.
Contrary to stereotypes, the majority of those who declare bankruptcy are not spendthrifts who abuse credit cards. Howard Ehrenberg, an attorney in Los Angeles who serves as a Chapter 7 bankruptcy trustee, sees more than 100 debtors a month who have filed for bankruptcy.
"They have not run up their bills with no intention of paying them," he says. "Most people file bankruptcy because one of three calamities has hit them - a serious illness to themselves or a person who makes the money in the household, the loss of a job, or a divorce."