Has your financial train gone off-track in recent months? If so, you’re definitely not the only one in Wisconsin who is currently facing such problems. The causes of your debt might be different than another person’s; however, many people say they experience similar situations, such as losing a job, having to pay child support or facing an unexpected medical need.
When discerning your financial future, it can be challenging to determine whether you’ll be better off if you stick it out and execute a debt management plan, or whether you should opt for a more immediate form of debt relief, such as bankruptcy. Since there are numerous types of bankruptcy, it pays to do a bit of research ahead of time, as you might be eligible for one kind but not another.
Ask yourself these questions first
Some people find they are able to restore financial stability without filing for bankruptcy. The following analyses may help you determine if you are one of those people:
- Is the main reason for your debt a bad spending habit? Do you treat credit like cash too often, and are you buying things you don’t need?
- Are you letting your pay cycle go through without paying off your credit card balance every month?
- Did you have the funds to pay the balance but decide to spend it on a weekend getaway instead?
- Have you suddenly become unemployed?
- Are you facing exorbitant medical expenses that you are not prepared to meet?
- Have unforeseen circumstances caused you to have to use your credit card, such as vehicle problems or unexpected home repairs?
If you answered yes to the first few questions, then you might simply need to adjust your spending habits to get your finances back on track. If, however, you answered yes to several of that latter questions, your financial problems might be much more serious than merely spending a little more than you should. In that case, you may be a candidate for bankruptcy.
Weighing your options
There are definite pros and cons to bankruptcy, with one of the cons being that it damages your credit score and remains on your credit report anywhere from seven to 10 years, depending on what type of bankruptcy you file. If you think that discharging your debt is the best way to lay the groundwork for a better financial future, then bankruptcy may be your best course of action.