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Beat Bankruptcy: 4 Options To Try Before You Declare Bankruptcy

Posted: March 4, 2020 at 7:38 am   /   by   /   comments (0)
Photo by Michael Longmire on Unsplash

Society has long favored the haves over the have nots. It’s one of the fundamental pillars of capitalism. We’re taught from a young age to chase dollars over fulfillment, and we’re often shown that not leading a certain lifestyle is the worst possible outcome. What we’re not taught is that our bank balance doesn’t define our worth.  Thinking of filing for bankruptcy is a sobering consideration, but there are alternatives. Here is a list of options to consider before filing:  

Borrow Intelligently

Spiraling debt is likely the cause of less-than-desirable financial situations.  It may seem odd that our top option is to borrow more money but, when done correctly, lending can help get things back on track. Low-interest loans are often designed for those who have fallen on financial hardship and offer better repayment terms than most of their counterparts. This means that if you can consolidate as much of your debt as possible into a loan and then chip away at it as quickly as you can. It’s easier to work down one balance and a single interest rate than keeping track of multiple payments across different lenders and institutions. You’ll buy yourself some much needed time to organize the rest of your finances.

Look Into Payment Plans

If you’ve been ignoring your bills because you can’t pay them, then it’s time to stop avoiding the issue and have an honest chat with your service provider. Most companies have policies in place for managing accounts where the payee can’t keep up with the costs. Talking to your provider about payment plans can help you avoid further debt collection and fees. Most of the time, lenders are open to working with you if you show a willingness to pay.

Take Odd Jobs

Most online forums are full of ads hunting people to do the most basic of tasks. Although mowing lawns or cleaning after events may not be your dream jobs, they can help provide much-needed income to keep your head above water a little longer. Plus, your willingness to work and support yourself reflects favorably on you when applying for full-time employment or dealing with collections agencies. You can also consider joining the sharing economy if you have the ability to drive passengers to their destinations, or you can rent your space and earn side income that way.  There are many companies offering these types of services in many areas of the world. Just remember to always put your safety first and have an emergency plan ready. No amount of money is worth your health and safety. 

Liquidate Your Assets

Nobody wants to sell off their treasured belongings but the unfortunate reality is that you’ll most likely lose them anyway if you file for bankruptcy. By selling things yourself you get to control what items get listed, therefore protecting sentimental pieces, and you may be able to tide yourself over with the profits until you find a more sustainable option. If your troubles are more short term, then consider pawning items but remember that you’ll most likely pay interest and storage fees, so this isn’t the best option if you’re unsure when the next paycheck will be coming in.

Money troubles affect almost everyone at some point in their life. There’s no shame in needing a little extra help. Before you admit defeat, explore the above options and have a chat with a local finance professional, if possible. 

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