|March 28, 2017||0|
Personal bankruptcy is never the preferred predicament to be in, however many people find relief in dealing with their financial problems and starting over. Nobody is perfect, and people make mistakes. Yet too many individuals hold off filing for bankruptcy for far too long. They prefer to ignore the elephant in the room and spend years fighting just to make ends meet. Yes, bankruptcy is never pleasurable and lots of people find it embarrassing, nevertheless it is the very first step towards financial freedom. Always remember that there is a life after bankruptcy.
If you’re struggling financially and looking at bankruptcy, it’s necessary to recognise 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 eventually 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 eventually. Naturally, it’s fine to have a balance on your credit card debt for a few months, but it’s necessary that you think long-term. If you’re suffocating in interest fees 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. Most financial advisors highly recommend having three to six months of living expenses in a specialised bank account. This account should cover all your expenses for that time period: rent, food, transport, bills. What would happen if you lose your job? Or you cannot work as a result of illness? And if you’re purchasing luxury items while you have high interest loans outstanding, 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 helpful way to buy items by giving yourself a short-term loan, particularly in today’s cashless world. Usually, 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 are using credit cards to pay for bills since you simply don’t have enough funds, you’re on the brink of disaster. Some people will even have a number of 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 really harmful if used wrongfully. Paying bills with debt only leads to more debt, with big interest charges added on. If this sounds familiar, seek professional advice asap.
Debt collectors are phoning you
It may seem obvious, but if debt collectors are frequently harassing you on the phone or in the mail, you should look at bankruptcy help. Think of it this way; creditors who feel that they can’t recuperate their money from you will sell your debt at a lower rate to debt collectors. If lenders have lost faith in your ability to pay your bills, there is undeniably a problem. If you’re frightened to answer the phone or check your mail because of debt collectors, it’s time to act. You can only avoid those threatening phone calls and letters for so long before your quality of life begins to diminish. Pick up the phone and call the professionals, that’s what they’re there for.
Are you so anxious about your financial future that you can’t sleep at night? This is quite possibly the biggest warning sign that you’re moving towards bankruptcy. When your health and happiness are languishing because of your financial circumstances, 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 fact, the first step towards financial freedom. Consult with a bankruptcy expert to find out what options you have.
If you’re experiencing any of the above warning signs, chances are that you’re currently in financial hardship and are heading towards bankruptcy if changes aren’t made. Personal insolvency is the final step in a long process, and commonly there are options before you need file for bankruptcy. To find out what options you have, or to talk with someone about your financial condition, contact Fresh Start Solutions Gold Coast on 1300 818 575 or visit http://freshstartsolutions.com.au/bankruptcy-goldcoast