|March 28, 2017||10|
Personal bankruptcy is never the preferred position to be in, however lots of individuals find relief in dealing with their financial problems and starting afresh. Nobody is perfect, and people make mistakes. Yet a lot of men and women put off filing for bankruptcy for far too long. They prefer to ignore the elephant in the room and spend many years fighting just to make ends meet. Yes, bankruptcy is never pleasing and many individuals find it humiliating, however it is the very first step towards financial freedom. Always bear in mind that there is a life after bankruptcy.
If you’re struggling financially and thinking about bankruptcy, it’s useful to understand the warning signs. Here are a couple of 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 income source isn’t increasing. Interest charges and fees will soon force you to make a change, either by acquiring a second job or consolidating your loans. And if you don’t make a change, something must give at some time. Obviously, 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 drowning 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. A large number of financial specialists strongly recommend having three to six months of living expenses in a separate savings account. This account should cover all of your expenses for that period: rent, meals, transport, bills. What happens if you lose your job? Or cannot work because of sickness? And if you’re buying 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 bank account, personal insolvency may well become a reality.
Using credit cards to pay your bills.
Credit Cards are a practical way to purchase items by giving yourself a short-term loan, particularly in today’s cashless society. Typically, there is an interest-free period of a month or two, but after this time, the interest rates and charges are particularly high. If you find yourself using credit cards to pay for bills since 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 repay one with another. This is a key sign that you’re looking at personal bankruptcy. Credit cards can be considerably hazardous if used incorrectly. Paying bills with debt only generates more debt, with big interest charges added on. If this sounds familiar, seek professional advice as soon as possible.
Debt collectors are contacting you
It may appear to be obvious, but if debt collectors are regularly hassling you on the phone or in the mail, you should think about bankruptcy help. Think about it this way; lenders who feel that they aren’t able to recuperate their loan from you will sell your debt at a lower rate to debt collectors. If lenders have lost faith in your capacity to pay your bills, there is certainly a problem. If you’re afraid to answer the phone or check your mail because of debt collectors, it’s time to take action. You can only overlook those threatening phone calls and letters for so long before your quality of life starts to deteriorate. Pick up the phone and call the professionals, that’s what they’re there for.
Are you so worried about your financial future that you can’t sleep at night? This is quite possibly the biggest warning sign that you’re heading for bankruptcy. When your health and happiness are suffering due to your financial situation, it’s time to realise that you need help simply to improve your quality of life. Bankruptcy is not the end of the world, and is, literally, the first step towards financial freedom. Consult with a bankruptcy expert to discover what options you have.
If you’re experiencing any of the above warning signs, chances are that you’re actively in financial distress 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 to someone about your financial condition, contact Fresh Start Solutions on 1300 818 575 or visit https://freshstartsolutions.com.au