|March 28, 2017||0|
Personal bankruptcy is never the ideal position to be in, however lots of individuals find relief in dealing with their financial troubles and starting afresh. Nobody is perfect, and people make mistakes. But a lot of individuals avoid filing for bankruptcy for far too long. They choose to ignore the elephant in the room and spend years fighting just to make ends meet. Yes, bankruptcy is never satisfying and lots of people find it humiliating, nonetheless 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 considering bankruptcy, it’s necessary to identify the warning signs. Here are a few signs that you’re in serious financial trouble.
Making minimum repayments only
One of the clearest signs of financial problems is when you can only afford the minimum repayments on your loans, yet your salary isn’t increasing. Interest charges and fees will shortly 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 at some point. Surely, it’s fine to have a balance on your credit card debt for a few months, but it’s critical 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 realise that your savings are being used to make repayments on your loans, you’re heading for trouble. The majority of financial experts advise having three to six months of living expenses in a specialised bank account. This account should cover all your expenses for that period: rent, meals, transport, bills. What would happen if you lose your job? Or cannot work as a result of sickness? And if you’re purchasing luxury items while you have high interest loans overdue, 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 convenient way to purchase items by giving yourself a short-term loan, especially in today’s cashless world. Typically, there is an interest-free period of a month or two, but after this time, the interest rates and charges are incredibly high. If you end up using credit cards to pay for bills given that you simply don’t have enough cash, you’re on the brink of disaster. Some people will even have several credit cards so they can repay one with another. This is a key sign that you’re steering towards personal bankruptcy. Credit cards can be very hazardous if used incorrectly. Paying bills with debt only brings about more debt, with big interest charges added on. If this sounds familiar, seek professional advice asap.
Debt collectors are getting in touch with you
It may seem to be obvious, but if debt collectors are repeatedly hassling you on the phone or in the mail, you should consider bankruptcy help. Imagine it this way; lenders who conclude that they can’t recover 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 definitely a problem. If you’re afraid to answer the phone or open your mail due to debt collectors, it’s time to take action. You can only avoid those threatening phone calls and letters for so long before your quality of life starts to diminish. Pick up the phone and call the specialists, that’s what they’re there for.
Are you so worried about your financial future that you can’t sleep at night? This is possibly the greatest warning sign that you’re heading for bankruptcy. When your health and happiness are diminishing because of your financial circumstances, 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 to a bankruptcy expert to find out what options you have.
If you’re encountering any of the above warning signs, chances are that you’re already 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 to someone about your financial condition, contact Fresh Start Solutions Hobart on 1300 818 575 or visit http://freshstartsolutions.com.au/bankruptcy-hobart