When challenges occur in your life, some people rally to support you while others wag a judgmental finger. The way others react and think about you can deter you from making decisions that will help you during hard times.
This reality is true for many people when it comes to bankruptcy. The stigma attached to this course of action may be causing you to hesitate to proceed. You may worry that it is a morally wrong thing to do or will hurt your reputation. The truth is that bankruptcy is an effective way to get out of debt, and getting out of debt is a positive, smart and courageous thing to do.
You are not alone
Bankruptcy is more common than you think and has been around for centuries. According to the United States Courts, 2017 had 789,020 bankruptcy filings, with 97 percent of them being nonbusiness bankruptcies. Taking this route does not mean you were irresponsible with your finances. Besides credit card debt from shopping purchases, common reasons for bankruptcy include medical bills, loss of employment, bad investments, divorce and student loans.
These distresses can happen to anyone regardless of financial status. However, it tends to be more prevalent among those in the middle class. The demographics of filers also include those who:
- Are divorced or widowed
- Have only a high school diploma or some college education
- Have a disability
- Are veterans
- Are middle-aged
These traits make sense in relation to the common causes of bankruptcy.
Make the move
You may still have some fears over filing for bankruptcy, but staying in debt should cause you greater worry because it leads to more negative consequences. Bankruptcy comes with many advantages, such as stopping creditor harassment, protecting your assets and improving your credit score. Having a plan to get your finances back on track shows responsibility and wisdom, so go ahead and make the move to file.