No matter how hard you try to avoid bankruptcy, there may come a point when you have no choice but to go down this path. However, before you make this decision, be sure it's best for you and your finances.
Here are five signs that often point consumers toward bankruptcy:
- You're relying heavily on credit cards. If you're using credit cards to make everyday purchases and to pay some or all your bills, it's time to escape the cycle.
- You're working multiple jobs. There's nothing wrong with hard work, but if you've taken on multiple jobs in an attempt to dig yourself out of debt, you may want to learn more about bankruptcy.
- You're losing money to wage garnishment. A lender may be able to secure a court order to garnish your wages. You can end this by filing for bankruptcy.
- You received a foreclosure notice. If you slip behind on your mortgage, your lender may send a foreclosure notice to alert you. By filing for bankruptcy, your lender is not permitted to proceed with the foreclosure process, at least for the time being.
- You're considering using your retirement savings to pay down debt. It's an idea many people consider, but you will end up regretting it in the future. There are other options, e.g., bankruptcy, that often make more sense.
If you come to realize that bankruptcy is the best way to improve your finances, learn more about your options and make a decision based on your findings. You may discover that a bankruptcy filing can help solve most of your financial problems.