Once a bankrupt, it will haunt you for years and years, and it will be really hard to reconstruct your life, and unfortunately you will become differentiated by the rest of the people who have a clean credit history. You will surely want to purchase another home, but on basis of your spotted credit history, and with a past of bankruptcy in many cases you have to accept as an initial payment as much as half of its value; moreover, they will make sure that your monthly rates reach the level of absurdity. Lenders will make it hard for you, be sure of this one. And because we live in this consumer society, characterized by the credit cards “boom”, let me tell you the bad news that it is unlikely that you will get hold of another credit card, unless you can grant with a significant deposit most of the times. And because extra fees are everywhere, especially if you have a bankruptcy history, credit card companies will arrange that for you, too. The list could continue with several obstacles you meet, should you file for bankruptcy.

You may ask yourself which is the limit, “when should I choose to file for bankruptcy then?”. Make your own calculations, and if you come to the result that your debts sum up almost half of your annual income, then you should consider filing for a bankruptcy petition. Also, if you have failed in coming to an agreement with most of your creditors, or you have exhausted all other available resources with no result, then it is time to choose the alternative of bankruptcy. Always keep this alternative as the last one that exists. Do not enter into panic and jump for solutions that you may regret later on, because as already stated above all this may have serious repercussions on your future plans. If you own a company which is on the verge of bankruptcy, always try other alternatives: you never know, there may be someone who wants to become your associate and willing to invest to bring the business back on track. If so, you are a most lucky person, but you will probably have to make double efforts to prove you associate that it was worth his investment. It is an utopist thinking a little bit, but miracles can happen. Try to reduce your expenditures, give up as much as you can luxury items, and mainly those things that you can do without. Live a simpler life for some months to see what you can spare, before filing bankruptcy. There will be surely some results, it’s amazing how many things we owe just because trend says so, and we don’t actually “need” them.

There are indeed many alternatives before declaring yourself bankrupt; the question is how ready you feel to give up some assets, and parts of your mentality for the benefit of a debt free life. Depending on your time and will, you could also turn to part-time jobs which will constitute an extra source of income. Nowadays, there are plenty of opportunities for choosing a second job that is adapted to your needs (e.g. you would want to work from home). This way you can rely on your basic source of income for paying your debts.

Before letting yourself come under the scrutiny of most creditors in the future, you should give yourself the chance of trying to live debt free by your own efforts, and start a plan to repair step-by-step parts of the damage. You will surely feel more relieved this way than having declared yourself bankrupt. Stay debt free and avoid falling for the magic of consumerism!