|March 28, 2017||Comments Closed|
Personal bankruptcy is never the ideal position to be in, however lots of people find relief in dealing with their financial issues and starting afresh. Nobody is perfect, and people make mistakes. Yet too many people put off filing for bankruptcy for far too long. They choose to ignore the elephant in the room and spend many years struggling just to make ends meet. Yes, bankruptcy is never appealing 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 considering bankruptcy, it’s relevant to acknowledge the warning signs. Here are a number of signs that you’re in serious financial distress.
Making minimum repayments only
One of the clearest signs of financial difficulties 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 quickly 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 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 experts recommend having three to six months of living expenses in a specialised savings account. This account should cover all your expenses for that period of time: rent, food, petrol, bills. What happens 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 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 helpful way to buy items by giving yourself a short-term loan, especially in today’s cashless society. Generally, there is an interest-free period of a month or two, but after this time, the interest rates and charges are extremely high. If you find yourself 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 couple of 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 really harmful if used improperly. Paying bills with debt only causes 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 appear to be obvious, but if debt collectors are repeatedly plaguing you on the phone or in the mail, you should look at bankruptcy help. Visualise it this way; lenders who feel that they can’t recover their loan from you will sell your debt at a discounted rate to debt collectors. If lenders have lost faith in your ability to pay your bills, there is certainly a problem. If you’re scared to answer the phone or open your mail as a result of debt collectors, it’s time to take action. You can only dismiss those threatening phone calls and letters for so long before your quality of life begins to deteriorate. Pick up the phone and call the experts, that’s what they’re there for.
Are you so distressed about your financial future that you can’t sleep at night? This is possibly the greatest warning sign that you’re steering towards bankruptcy. When your health and happiness are descending as a result of your financial predicament, 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 with a bankruptcy expert to find out what options you have.
If you’re encountering any of these 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 normally 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 Bankruptcy Bendigo on 1300 818 575 or visit http://www.bankruptcy-bendigo.com.au/