Planning Your Future and Staying Bankruptcy Free
Lyle Evans
What exactly is bankruptcy? Bankruptcy is when your assets
are tied up and you cannot pay your debts. There are a
number of different bankruptcies that are open to
individuals. These different bankruptcy options were created
to help individuals and their special needs.
However, bankruptcy's effects can last for years, including
difficulty finding a job, getting insurance, renting an
apartment, buying a home and financing a car. Bankruptcy can
stay on your credit record for up to 10 years. The rest of
this article will deal with ways to try and avoid
bankruptcy.
As mentioned in previous articles a good budget is one of
the most valuable financial tools you can have. Every
individual or family needs to develop a budget and follow
it. Impulse buying is not only dangerous for large expensive
items, it can also be costly for smaller purchases that add
up, killing your budget and pushing you further into debt.
When going to buy a large or expensive item a good rule of
thumb is to go and look and leave your checkbook, credit
card, or financing information at home. When looking to buy
these large items go and look around at more than one place.
There is usually more than one store or dealer in the area
that has comparable products to look at.
The more places you visit the better idea you get of what a
fair price is. Take time to evaluate the merchandise you
have seen. When you do this, you will eliminate impulse
buying or buying on emotion. When you have done your
research and determined that you really need the item, then
you are prepared to go and purchase it.
Living within your means creates a future of financial
stability. There are many things that can be done to live
within our means. Some of these things include driving nice,
dependable vehicles, not the latest and greatest; and
purchasing a home that meets your needs, not a large home
which carries an astronomical mortgage. Don't get caught up
in trying to impress your neighbor by buying things you
can't afford or don't need. There is only one person that
can keep you from bankruptcy and that's you. Have some self
control.
If you find that you are really in overwhelming debt, there
are steps that can be taken. Evaluate your financial
circumstances. If you have large credit card debts that you
can't afford, contact the credit card company and try to
work out a payment plan that works for you. If you have
other large bills, try and contact these companies and see
if they will work with you. Sit down and figure out what
your debt to income ratio is.
This can be done by adding up how much take-home pay there
is against how much there is in bills. If your debt ratio is
close to or higher than your income, then you need to
seriously evaluate your spending habits. Unavoidable medical
expenses or disasters that cause major debt have to be dealt
with on an individual basis and may require the advice of a
competent financial planner. Day-to-day financial monitoring
will help you improve your financial future.
If you need the help of a financial advisor, it will be
worth your time to do your homework and find out who will be
the best at helping you. There are a number of ways to go
about finding a financial advisor. A good place to start is
by asking friends and acquaintances if they know or have
heard of anyone that is good. You can also check in the
yellow pages.
However, be aware of billboards and radio/TV ads, and check
with your local BBB. Once you have found a good potential
advisor, ask them about their credentials and ask for
references of satisfied customers. Ask how their work will
help you and how it will effect your credit. Don't be afraid
to ask questions to find out if this is the right person to
help you.
Remember this individual is going to give you advice that is
going to effect your financial future. There are financial
services that charge large service fees, and those that are
non-profit that are less expensive. It will depend on what
you feel comfortable with and who you think will give you
the most help.
Finally, if you own a lot of expensive items, you may think
about trying to sell off items to raise money to pay off
debt. Consider getting a second job to help to bring in
extra income. Look at borrowing against any reserves you may
have. (Do this only after consulting a good professional
advisor.)
Avoiding bankruptcy requires vigilance and determination.
Bankruptcy and its long-term effects should be considered
very carefully. Working hard to overcome financial woes will
give you an improved sense of self-worth and well-being.
************************************************************
© Simple Joe, Inc.
© Simple Joe, Inc.
Lyle Evans is a software testing specialist for Simple Joe,
Inc., makers of the popular Simple Joe's Income &
Expenses PC software. Income & Expenses is a quick
and simple way to keep track of your cash flow and stay
within your budget. The Income & Expenses software
(http://www.simplejoe.com/incomeexpenses/index2.htm)
is ideal for personal, business, home and club accounting.
This article may be freely distributed as long as the copyright,
author's information and an active link (where possible) are
included.
Re-visit My Millionaire Friend