Will Bankruptcy Give You A Fresh Start?
Do your bills keep piling up and your income just can’t keep up? Do you have a huge debt load that dwarfs your income? Have you gotten laid off and have tons of debt? If you answered yes to any of the above, declaring bankruptcy might be an option for you.
If you are reading this blog post, you may have some ideas on how bankruptcy works and how it can help you. The good news is that the law does provide for a legal way to wipe out a large chunk of your debts. The bad news is that there quite a bit of hoops and hurdles you have to go through. Moreover, even if you were able to wipe out most of your financial obligations through bankruptcy, you might find yourself in a financial hole again.
The truth of the matter is bankruptcy does not work for everyone. It only works for people who use it the right way. It can provide a fresh start. It can provide breathing space so you can get your financial life together. However, if you have the wrong attitude about money and debts and you have certain spending habits, a whole lifetime of declaring bankruptcy might not do you a lick of good.
Read the guide below to get a clear idea of the mindset and attitude you need to make bankruptcy do what it is intended to do-to give people a new start.
Bankruptcy Won’t Work For You If You Have Certain Habits
If you keep spending on stuff you don’t really need and you don’t do any comparison shopping or apply some sort of basic shopping strategy, bankruptcy won’t help you. Most people declare bankruptcy to get a new start in life. They need their debts cleared up so they can start planning again and getting their lives in order.
Unfortunately, if you have the same spending habits before you declared bankruptcy, you will find yourself in the same financial hole in no time at all. You can’t blame credit card companies that offer credit to people who have filed bankruptcy in the past. You can’t blame easy finance schemes. You only have yourself to blame.
Make sure you own up to the following habits and consciously seek to break them: impulse buying, shopping with no clear plan, buying stuff before paying down expenses. You have to first realize you have a bad habit before you can resolve to change your habits. Unfortunately, too many people are in denial and the problem never gets addressed. If you want your life to change, don’t be one of these people. Look at your problem straight in the eye and resolve to get your financial house in order.
Bankruptcy Will Help You If You Have The Right Mindset
You have to have the right mindset when you declare bankruptcy. If you don’t have the proper mindset before you file, you should wait to file until after you have changed your mindset. This can only help you to ensure that your bankruptcy filing has the desired effect. However, if your mindset after filing is the same as it was before, little of your financial life will change. You will still spend money wastefully and you will still find yourself in a financial hole.
One key step to changing your mindset is to view money the right way. Money is a tool to help you buy stuff that you need. It is not an ego booster nor is it an emotional tranquilizer or stimulant. Sadly, way too many consumers use shopping as a mental therapy to deal with the everyday stresses they face. Talk about a very expensive form of therapy! You have to find a healthier and less financially damaging way to deal with your stress. Pick up a new hobby or some activity to replace shopping. Put shopping in its proper place.
Bankruptcy Is Not A Magic Bullet But a Fresh Start
Way too many consumers think that bankruptcy will magically wipe out all their problems. Wrong. It is just a tool. And like any other tool, its effectiveness in meeting goals depends solely on the person handling the tool. Bankruptcies may also be able to wipe out your credit card debt and payday loans that you took out from a payday loan company. The whole point of bankruptcy is to get a fresh start. Use it accordingly.
Note: This article originally appeared at I Am 1 Percent.
Category: Personal Finance
