Four Signs That You May Need To File Bankruptcy

June 3rd, 2010 by Reed Allmand

1. You may need to file bankruptcy if you have less than three months of savings and you currently do not earn enough money to shore up your savings account.  Most experts say that you need a minimum of 3 months savings in case of an emergency and that’s if you are fully employed with the benefit of having unemployment insurance.  If you are self-employed or unemployed with large debt obligations you may want to seriously consider bankruptcy if your savings is low.
2. You may need to file bankruptcy if money is the main source of conflict in your household.  Oftentimes we are so close to our situation that we can’t see it clearly.  But many experts say that money is one of the main causes of divorce in this country.  But what that really translates to is debt and lack of income is one of the leading causes of divorce. By filing bankruptcy, many couples find that their arguments over money disappear because they have eliminated the main source of their arguments—unpaid debt.
3. You may need to file bankruptcy if more than 30 percent of your income is dedicated to repaying debt.  With the rising costs of housing and daily living expenses, committing more than 30 percent of your income to repay debt is often a formula for long-term financial disaster. Bankruptcy frees up more of your income so that you can commit it to the things that matter such as medical care, retirement and your kids’ future.
4. You may need to file bankruptcy if you are unable to save for retirement due to a high debt load.  Many debtors overlook the negative impact a high level of debt can have on a person’s future.  Debt robs people of their future income and if left uncheck can even rob them of their retirement years.  Bankruptcy discharges many debts and allows debtors to use the future income to fund retirement accounts so that they don’t face destitution in their elderly years.

About Reed Allmand

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Allmand's vision is rooted in his own financially precarious childhood in Abilene "My father always had difficulty holding a job and supporting our family, so after my parents divorced when I was 12, my sister and I got jobs to help make ends meet," he recalls. "I remember what it felt like as a child to worry that our car would be repossessed or home foreclosed on."

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