There is nothing fun about bankruptcy. It has serious life-changing ramifications. However, living with financial chaos is far worse than finding a real and meaningful solution that can bring you back to the stability of financial health. If you find yourself considering bankruptcy, the most important thing to consider is no matter how you have gotten here—poor money management, overspending, job loss, or perhaps medical bills—you need to focus on solutions.
The biggest problem you face as a person considering bankruptcy the loss of confidence. If you are caught up in the thought that bankruptcy should be faced with shame and stigma as a person considering bankruptcy is your loss of self-esteem. If you are caught up in the idea that bankruptcy should be faced with shame and stigma, you will find the bankruptcy process awful. You are also experiencing fear and anxiety. Remember, you are far from the only one in the world who is in this situation. Bankruptcies are almost epidemic because of the changing climate of our economy and the ridiculously easy access to credit we all have.
Although statistics vary, it is estimated that the average family has about $7,327 in credit card debt. This is outrageous. Most bankruptcies are filed because the debtor, you, is no longer able to handle the minimum payments of the many credit accounts you have at any given time. If you want to make it through the process of bankruptcy without experiencing total trauma and misery, you are going to have to develop a thick skin, objectivity, and the ability to accept your circumstances without the recriminating “what ifs.” If you can do these things, you can avoid decision paralysis. Once you make the decision to file bankruptcy, the process is essentially black and white. You are the additional ingredient that will determine the quality of the out- come and how well you are able to rebuild your life.
If you are ready to face your situation head-on, you will find that the process of bankruptcy, although it involves material loss, will be the most freeing experience you will probably ever have. If you have been choking in a sea of debt, you are already in the depths of financial despair. Most of us live in denial of how out of control our financial situation really is. As we see the downward slide, we pretend it isn’t happening by filling our desk drawers with unopened bills we know we cannot pay. We find many ways to avoid the truth.
Now that you are looking at the reality of your circumstances, the worst is really over. It may not seem that way at first, but when you unravel your debts and figure out a way toward a fresh start, you will be able to exhale and untie the knots that are permanent residents of your lower intestines. We are not advocating that bankruptcy is your solution. By looking directly at your particular money monsters, you will find that there are things you can do before bankruptcy becomes the inevitable next step.
There are many paths you can take before you need to consider bankruptcy as a remedy. When you have exhausted all of your possibilities and have made the decision to file. Before you move ahead into the details, take time to be proud that you are staring your monster down. You are turning on the closet light to see what is really lurking inside. Your debt is of your creation, but the monster grows stronger in your imagination and might not be as bad as it seems.
Commend yourself for having the courage to pick up this book. You have decided to do something to help yourself. You may feel that you do not have a choice, but everything is a choice. Many people sit back and wait for things to happen to them without initiating a positive first step.
Bankruptcy exists as an opportunity for you to turn your life around so you can get a fresh start. So cheer up. It isn’t going to be horrible. There are other people who share your problems who then go on to make changes that will prevent financial distress in the future.
Many bankruptcies are a simple matter of filing the right forms and showing up. However, we do not recommend that you file bankruptcy without at least consulting an attorney. You have spent money on far more useless things in your past. This is money well spent, particularly if your case involves a house, significant assets, or issues with the IRS. Even if your case is simple, the advice you receive from a professional will help you move through the system with some doable plan for your future.
Don’t drive yourself crazier than you probably already are feeling. There are nuances to the bankruptcy process and laws that may be better left to someone who understands them. You don’t really want to have to know everything about bankruptcy unless it is really exciting and stimulating for you.
Whether or not you file on your own, you have many decisions to make. There are things you can do to plan ahead for your filing. There are decisions to make regarding what filing you want to make.
Remember that no matter what the details of the bankruptcy filing, the most troubling aspect of the process is what is happening between your ears—in your head. If you can keep perspective and avoid the traps of guilt, humiliation, blame, and second-guessing, you can get through without as much damage to the life you have beyond finances. Think of it this way: Lack of money caused by a mountain of debt affects your most primal needs of security, shelter, and sustenance. Bankruptcy has definite unpleasant repercussions, but there is nothing as terrible as what you will do to yourself if you panic.