Are You Facing Bankruptcy?

Do you know, there are 60 people aged between 35 and 44 years are declared bankrupt everyday? This makes them the highest out of the total number (34%). This group is followed by those aged 45-54 (26%), 25-34 (20%), and 55 and above (11%).


The number of bankruptcy is keep increasing each year from 13,238 people in 2007, 13,855 in 2008, 16,228 in 2009, 18,119 in 2010, 19,167 in 2011 and 19,575 in 2012. The number is surprisingly high!


The reason why people will fall into bankruptcy situation is that they always spend more than they earn. For example, spending by using credit cards and apply for loan immediately they get a job. In the end, they couldn't afford to pay the debt and thus, declared bankruptcy. This situation is not good for both the individual or the country. So, one should control and manage their money and wealth wisely.


The following are the steps in order to avoid bankruptcy.

Seek Consumer Credit Counselling

If you don't have luck working with your creditors on your own, enlist the help of a professional. Find a consumer credit counsellor who has experience working with creditors to get your payment and interest rate reduced. The new bankruptcy law requires credit counselling prior to bankruptcy filings anyway so it's worth it to strongly consider credit counselling as a bankruptcy alternative. The debt management plan payments may seem out of reach, but if you look, you may find holes in your budget that allow you to make the payments.

Selling Some of Your Assets

Sell whatever you can spare and use the money to pay off your debts. Take action immediately when you notice you can't afford make payments anymore. If you wait until you're behind on payments, it may be too late. You can sell your furniture, jewelry, and electronics on eBay, Craigslist, even in your front yard. Is this a radical way to avoid bankruptcy? Perhaps. Many people can't get past the inconvenience of living without their things, but you can adjust and it's only temporary. It will help you avoid bankruptcy and spare your credit.

Settle With Creditors and Debt Collectors

Debt settlement is another of those things that should be avoided under normal circumstances. However, the brink of bankruptcy isn't normal. If you have to choose between settling a few debts or filing bankruptcy, settle the debts, but do it right. First, don't use a debt settlement company. Too much time and extra money goes into these companies than is necessary. Second, don't settle any debt that is current. Instead, focus on debts that have already been charged off or sent to collection. Finally, be ready to pay as soon as an agreement has been made.

Get Help From Family and Friends

Normally, borrowing money from family and friends is a bad idea. It's been known to create hardships and even end relationships. But there's an exception to every rule, and bankruptcy is one. Take the time to calculate how much money you need to avoid bankruptcy. Take a hard look at what you're able to contribute, then ask friends and family to help you make up the difference. Before you approach them with your wallets turned out, come up with a plan for how you will repay them once your financial situation has turned around.

Manage your wealth wisely, make sure you will not go into trouble. =)