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Avoid BankruptcyDon’t Spend More Money than you have and you’ll Avoid BankruptcyThese days bankruptcy is so prevalent that it’s almost become commonplace. Not so long ago it was a mark of shame, and people would do all that they could to avoid the embarrassment of going bankrupt. This doesn’t seem to be the case anymore as people are filing in record numbers. The best advice for anyone is to not be taken in by our spending mentality and keep our finances under control. We’re definitely a society of consumers. We’re urged to buy, buy, buy and if we don’t have the cash, we can do the easy thing and “charge it. Credit card companies make it really easy to do so. Most of us receive offers for a new credit card in the mail every week. And to make it even simpler, we can now apply online. It’s a competitive industry, with various card companies offering lower interest rates, incentives if you transfer balances from other cards, and no annual fees. What they often put in the finest print, that in order to qualify for the really good benefits, you need to have perfect credit. It’s easy to be seduced into applying for all these cards and credit at stores. When you buy a house or a car, salespeople knock themselves out telling you what a great deal you’re getting. What they forget to tell you is that if you don’t monitor you’re expenses, you’re a prime candidate to get yourself into debt. Some people get so deep into debt, they must take serious steps just to avoid bankruptcy. No one is responsible for how much you spend except you. If you are someone who has trouble with your income to spending ratio, you need to take some proactive steps so that you’ll avoid bankruptcy. Yes, it sounds like a lot of extra work, but you really should consider writing out a monthly budget. List all of your regular monthly expenses such as mortgage or rent, car payment, cable and phone bills, food and utilities, and definitely try to put away some savings or into a retirement account. For a few months, write down every penny you spend each day. Then you’ll see where you’re getting yourself into trouble. Those unnecessary lunches, espressos, magazines, movies, and clothes can add up pretty quickly. When you compare what is going out to what you bring in, you’ll be able to quickly see if you have problems. The way to avoid bankruptcy is to stick to your budget. If you want to use credit, pay off what you buy each month so you won’t end up paying interest. It’s ironic, but the people with the most money to spend are the best candidates for credit. It may be less of a stigma to declare bankruptcy than in the past, but it’s still a lot easier and more sensible if you avoid bankruptcy altogether. Other Articles: |
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