Signs You May Want To Consider Bankruptcy
Personal bankruptcy is never the ideal predicament to be in, however lots of individuals find relief in dealing with their financial troubles and starting over. No one is perfect, and people make mistakes. But a lot of people put off filing for bankruptcy for far too long. They choose to ignore the elephant in the room and spend several years fighting just to make ends meet. Yes, bankruptcy is never pleasurable and many people find it embarrassing, nonetheless it is the very first step towards financial freedom. Always bear in mind that there is a life after bankruptcy.
If you’re struggling financially and looking into bankruptcy, it’s useful to acknowledge the warning signs. Here are a couple of signs that you’re in serious financial distress.
Making minimum repayments only
One of the clearest signs of financial troubles is when you can only afford the minimum repayments on your loans, yet your salary isn’t increasing. Interest charges and fees will quickly force you to make a change, either by working a second job or consolidating your loans. And if you don’t make a change, something must give at some time. Naturally, it’s okay to have a balance on your credit card debt for a few months, but it’s important that you think long-term. If you’re drowning in interest charges and can only afford to make the minimum repayments, it’s time to make a change.
If you’re living paycheck to paycheck and realise that your savings are being used to make repayments on your loans, you’re heading for trouble. A large number of financial specialists highly recommend having three to six months of living expenses in a specialised bank account. This account should cover all of your expenses for that period of time: rent, meals, petrol, bills. What would happen if you lose your job? Or can’t work as a result of illness? And if you’re purchasing luxury items while you have high interest loans unsettled, you should really get your priorities straight. Without having three to six months of living expenses in your savings account, personal insolvency may well become a reality.
Using credit cards to pay your bills.
Credit Cards are a practical way to purchase items by giving yourself a short-term loan, particularly in today’s cashless society. Ordinarily, there is an interest-free period of a month or two, but after this time, the interest rates and fees are very high. If you end up using credit cards to pay for bills simply because you simply don’t have enough funds, you’re on the brink of disaster. Some people will even have a few credit cards so they can pay off one with another. This is a key sign that you’re steering towards personal bankruptcy. Credit cards can be very precarious if used poorly. Paying bills with debt only generates more debt, with big interest charges added on. If this sounds familiar, seek professional advice immediately.
Debt collectors are phoning you
It may appear to be obvious, but if debt collectors are regularly plaguing you on the phone or in the mail, you should look at bankruptcy help. Think of it this way; lenders who feel that they can’t recover their money from you will sell your debt at a discounted rate to debt collectors. If lenders have lost faith in your capability to pay your bills, there is most certainly a problem. If you’re afraid to answer the phone or check your mail due to debt collectors, it’s time to act. You can only dismiss those threatening phone calls and letters for so long before your quality of life begins to deteriorate. Pick up the phone and call the experts, that’s what they’re there for.
Are you so troubled about your financial future that you can’t sleep at night? This is possibly the biggest warning sign that you’re moving towards bankruptcy. When your health and happiness are deteriorating due to your financial predicament, it’s time to acknowledge that you need help simply to improve your quality of life. Bankruptcy is not the end of the world, and is, in truth, the first step towards financial freedom. Talk with a bankruptcy expert to identify what options you have.
If you’re experiencing any of these warning signs, chances are that you’re actively in financial distress and are heading towards bankruptcy if changes aren’t made. Personal insolvency is the final step in a long process, and usually there are options before you need file for bankruptcy. To find out what options you have, or to speak with someone about your circumstances, contact Bankruptcy Experts Sydney on 1300 795 575 or visit http://www.bankruptcyexpertssydney.com.au