A surprising number of entrepreneurs have risen from the ashes of Chapter 7 bankruptcy to becoming multimillionaires. This scenario is even more common now with the shifting dotcom and Internet industries and the uncertainty of the stock market and the general economic climate. The fact is that bankruptcy does not have to mean the end of financial hopes and dreams but instead can be a springboard to success.
The secret to success after bankruptcy is often doing things differently the second time around. Changing your budget and your spending habits is not easy, but it is possible. Many entrepreneurs have found that when a business fails, it is a signal to investors and others that the business owner was willing to take risks. This can be a highly-prized characteristic in today’s flexible market.
For the individual, however, risk-taking may be the worst possible strategy. United States bankruptcy laws tend to be more lenient than those of other countries such as the United Kingdom, but that does not mean that bankruptcy courts are willing to allow debtors to return to willy-nilly spending after taking advantage of the bankruptcy laws.
Bankruptcy attorneys can help debtors decide if filing bankruptcy is in their best financial interest and can also help the debtors form a plan to pay off or discharge debt and receive a fresh start on their financial futures. Once a debtor has this fresh start, it is up to the individual to take advantage of the situation and learn better money management skills so that he or she can rebuild wealth and financial security.
Source: Spear’s, “When Entrepreneurs Go from Bankruptcy to Boom,” Sophie McBain, Dec. 4, 2012