Bankruptcy, Debt Negotiation, Wills & Personal Injury Representation

5 signs that it’s time to consider personal bankruptcy

On Behalf of | Dec 28, 2023 | Chapter 13 bankruptcy, Chapter 7 Bankruptcy

Have you been struggling with debt for years? Don’t be ashamed if you have been. Millions of Americans struggle to stay on top of their financial obligations, and every month many of these individuals have to make hard decisions about which bills they’ll pay and which they’ll have to let slide until next month.

Although your pride might drive you to work harder to try to claw your way out of debt, if you’ve found yourself here then you’ve probably realized that the process is too overwhelming, and the likelihood of ridding yourself of that debt is small. In fact, a lot of people who struggle with debt find themselves falling further behind despite their increased efforts to get ahead.

How can you tell if it’s time to seek bankruptcy?

Since you’re reading our blog, you’re probably wondering if bankruptcy is the right move for you. It can be hard to tell if the timing is right to seek bankruptcy protection, but there are some tell-tale signs that you should start considering it. This includes:

  1. You can’t afford the minimum payments on your debts: Your loans and credit cards are going to require a minimum monthly payment. If you can’t meet those obligations, then interest is going to compound, and your debt is going to quickly balloon. In these circumstances, it’s going to be extremely difficult for you to get out of debt without filing for bankruptcy.
  2. Your income is insufficient: While your income is going to dictate whether you can pay your bills, some people make enough to meet their debt obligations but they sacrifice their basic living to do so. If you’re struggling to put food on the table and maintain adequate housing because you’re trying to make good on your bills, then you might want to consider the relief that can be provided through the bankruptcy process.
  3. You’re being called by collection agencies: If you have debt that has been turned over to a collection agency, then you might find yourself ducking calls from those looking to get money from you. This can be stressful and overwhelming. The only way you’re going to be able to make these collection agencies go away is to either pay the debt owed or see your way through bankruptcy.
  4. You’re pulling from your retirement accounts: A lot of people who are struggling with debt do everything they can to try to make good on what they owe. This sometimes means pulling money from retirement accounts. But you shouldn’t do this. Your retirement savings might not be enough to cover the debt you owe, in which case you’re throwing away your financial future. This is because you might be able to discharge the debt at hand through the bankruptcy process while retaining your retirement assets by utilizing bankruptcy exemptions.
  5. You’re selling your belongings: Although you might be able to sell some of your assets to make money to pay bills, you might be able to keep these assets and get rid of debt through the bankruptcy process.

Do you want to learn more about personal bankruptcy?

Bankruptcy is a real option for debt relief, giving you the opportunity to secure the fresh financial start that you want and need. But we understand if you’re hesitant to embrace the process. That’s why we encourage you to continue to read up on what bankruptcy can and can’t do for you. By doing so, you won’t be taken by surprise, and you’ll know which decisions will position you for the future that you envision for yourself.