Struggling with debt is challenging, but there may be a time when filing for bankruptcy is your best option. It can be a tough pill to swallow, but there are clear signs to follow when it’s time to go down that path. Here are some indicators that are pointing you toward filing for bankruptcy.
You Always Pay Late
Regularly paying a bill past its due date can do more harm than good, though of course you shouldn’t skip a payment just because it will be late. Late payments are okay once in a while, but delaying most or all of your bills too often is a serious issue. Not only will your credit score get dinged, but your overall debt will grow larger because of late fees. If you struggle to come up with the minimum monthly payments, it could be a sign that you are in over your head.
You Have Multiple Sources of Debt
Bankruptcy can provide relief from medical bills, credit card debt, personal loans, and other sources of unsecured debt. It is challenging and overwhelming to tackle multiple sources of debt simultaneously, and bankruptcy can help eliminate that headache for you. Using credit cards to pay for necessities is also a sign of financial trouble.
Your Income Is Stagnant
Bankruptcy is a good option if you determine there is not a significant path to increase your income. Perhaps you have tried picking up additional jobs or asking for a promotion with no success. It can feel like you are a hamster on a wheel with no end in sight. Living paycheck to paycheck is tiresome, and it does not provide a clear path forward. You may be delaying the inevitable if you’re not using bankruptcy as an intervention.
You Understand Your Rights
If you are struggling with debt but have a basic understanding of bankruptcy law, it may be a good time to file. It will allow you to get a fresh start, and depending on your circumstances, you may be able to choose what bankruptcy chapter fits your situation best, depending on your goals and income. It’s best to meet with an attorney specializing in bankruptcy law to determine if it’s the right step for you.
There’s nothing to be ashamed of if you feel that it’s time to file for bankruptcy. Financial issues can happen to anyone at any time, and it does not mean that you have been irresponsible. No one has a goal of filing for bankruptcy, but if your debt is causing your stress and anxiety, bankruptcy could be the solution you need. Address it now before it’s too late.