|March 28, 2017||0|
Personal bankruptcy is never the best predicament to be in, however many individuals find relief in confronting their financial troubles and starting over. Nobody is perfect, and people make mistakes. But too many people hold off filing for bankruptcy for far too long. They prefer to ignore the elephant in the room and spend several years struggling just to make ends meet. Yes, bankruptcy is never appealing and lots of individuals find it humiliating, nevertheless it is the very first step towards financial freedom. Always keep in mind that there is a life after bankruptcy.
If you’re struggling financially and thinking about bankruptcy, it’s useful to acknowledge the warning signs. Here are a few signs that you’re in serious financial distress.
Making minimum repayments only
One of the clearest signs of financial challenges is when you can only afford the minimum repayments on your loans, yet your source of income isn’t increasing. Interest charges and fees will eventually force you to make a change, either by finding a second job or consolidating your loans. And if you don’t make a change, something must give eventually. Naturally, it’s alright to have a balance on your credit card debt for a few months, but it’s useful that you think long-term. If you’re suffocating 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 find that your savings are being used to make repayments on your loans, you’re heading for trouble. The majority of financial experts highly recommend having three to six months of living expenses in a specialised savings account. This account should cover all of your expenses for that time period: rent, meals, petrol, bills. What happens if you lose your job? Or cannot work due to sickness? 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 pay for items by giving yourself a short-term loan, especially in today’s cashless society. Commonly, there is an interest-free period of a month or two, but after this time, the interest rates and charges are extraordinarily high. If you find yourself using credit cards to pay for bills due to the fact that you simply don’t have enough money, you’re on the brink of disaster. Some people will even have various credit cards so they can pay off one with another. This is a key sign that you’re looking at personal bankruptcy. Credit cards can be considerably precarious if used improperly. Paying bills with debt only brings about more debt, with big interest charges added on. If this sounds familiar, seek professional advice immediately.
Debt collectors are phoning you
It may appear obvious, but if debt collectors are constantly plaguing you on the phone or in the mail, you should contemplate bankruptcy help. Think of it this way; lenders who believe that they cannot recoup 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 unquestionably a problem. If you’re afraid to answer the phone or check your mail as a result of debt collectors, it’s time to take action. You can only neglect those threatening phone calls and letters for so long before your quality of life begins to deteriorate. Pick up the phone and call the professionals, that’s what they’re there for.
Are you so distressed about your financial future that you can’t sleep at night? This is perhaps the biggest warning sign that you’re steering towards bankruptcy. When your health and happiness are declining due to your financial condition, it’s time to accept 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. Consult 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 hardship and are heading towards bankruptcy if changes aren’t made. Personal insolvency is the final step in a long process, and normally there are options before you need file for bankruptcy. To find out what options you have, or to speak with someone about your situation, contact Fresh Start Solutions Adelaide on 1300 818 575 or visit http://freshstartsolutions.com.au/bankruptcy-adelaide