Is Bankruptcy In Your Future?

Posted by Nick Niesen on October 29th, 2010

There are simple ways to tell if you are a candidate for bankruptcy. While this may not be the most encouraging news, it can be helpful if you are to make any lifestyle or fiscal changes to help change the future of your financial situation and right the ship in terms of your money management skills. The bottom line is, of course, how you choose to handle the news of impending bankruptcy and financial doom and the moves you make within your personal realm of control to change how you spend, how you invest, and how you manage your money in an overall sense.

As we know, bankruptcy means that you have the inability or lack the capacity by which to pay your creditors or those that you owe money to. This refers to a legally declared inability. Bankruptcy is not just a personally declared inability to pay your debts or bills. Your creditors could also declare a state of bankruptcy for you should they want to recover some of the money they are owed in light of the possibility of you not paying them. The primary purpose of legal bankruptcy is to give the person declaring bankruptcy a fresh start in the fiscal sense and relieve them of most of their debts.

This also allows for the repayment of the creditors in a timely manner, which is good news for them. The debts are resolved through the division of non-essential assets of the bankrupt debtor. This also allows the debtor to be discharged, officially, of the majority of their financial obligations even if their debts have not been paid in full. This happens after their non-exempt assets are distributed to their creditors. The creditors are not permitted to extend any lawsuits or continue any particular legal action after bankruptcy is declared.

Of course, part of preventing the entire need for this process is preparation and being able to pay your bills and complete the right processes in a consistent and timely manner. This may involve taking out short term loans or cash advances and consulting sources of financial relief from a payday company.

If you constantly find yourself in situations in which you are living from pay cheque to pay cheque and perhaps not making ends meet, it may be time to consider a short-term budget as a solution for your financial difficulties. If established earlier enough, this may help prevent you from becoming bankrupt. There are several different approaches that you can take to establish a budget routine. The routine should best reflect the known factors that you have recognized about your life and your cash situation. Looking at several online financial cash advance companies may have example budgets that you can apply to your own life.

If your financial situation doesn?t change you may want to consider a debt consolidation loan. Debt consolidators allow you to merge your debts into one affordable monthly payment. Car and house payments, education loans, credit cards, and personal loans can be merged into one debt consolidation loan.