I have always viewed bankruptcy as a disinterested party. It is true that bankruptcies have reached all-time highs. There are always huge companies filing for bankruptcy protection (Enron; most of the airlines; most of the suppliers to GM and Ford). Over the past year, a series of circumstances have really opened my eyes to how awful bankruptcy is for all parties involved.
For the creditors owed, they will not receive the money due them! This is HORRIBLE! They extended REAL MONEY to the individual(s) or company with the clear understanding (contract) that the money would be returned. They are now without the money AND now have little to no chance of recovering ANY of the money. What does this do to the company? For many companies and individuals, it could put them in serious financial conditions. In either case, the money needs to be made up elsewhere. Who makes it up? Those buying the products – the prices are increased to cover the losses.
For the individuals declaring bankruptcy, they KNOW that they are sticking their creditors with the debt. It is not something that they are disinterested in. They feel HORRIBLE about it! It impacts their family. It impacts their marriage. It impacts their relationships with their children. Worst of all – many individuals experience a LOSS OF HOPE! Hope is what sets the human spirit on fire! The individuals and companies can also lose the ability to conduct business with preferred providers as they are now blocked out via contracts, extremely high interest rates, or a unwillingness to conduct business with them period.
The sad thing is that most bankruptcies are preventable!!! It does require self-discipline! It does require spending less than is earned! It does mean that the word “NO!” enters our vocabulary.
If you are in desparate financial shape, go see a certified financial planner BEFORE visiting a bankruptcy attorney. You KNOW what the attorney’s recommendation will be.
You have had success! You have achieved financial peace. Debt is no longer a part of your life or it is rapidly becoming extinct. The house payment is gone or it is close to leaving. All of your other debts are paid off. You have a budget that is working. The retirement fund is growing. The college fund is growing. The daughter’s wedding fund is growing. The new car fund is in place. You have a fully-funded emergency fund.
Congratulations! You are among the few that have been able to tell themselves “No!” often enough to win financially! Great job! Because of this, you have changed your family’s future. Your family will have opportunities that many others have carelessly spent away.
Question for you: Are you paying it forward? Are you helping others learn the lessons you have learned? You have family members that need your help. They do not have the financial knowledge you have. They do not truly understand how to get from a debt-laden situation to a financially peaceful situation. You have friends that need your help. They need help setting up their first budget. They need help buying that first house. Your children need you to teach them how to wisely manage money. Are you teaching them?
Take the challenge – teach someone else about how to effectively manage their personal finances this week!
So I just got back from the wake of a family member we lost unexpectedly. Fifty years young. Game over.
Do you have a plan? Are you ready? Will those who rely on you be able to continue without you? One HUGE way to ensure that your family can continue on without major life changes is to have term life insurance. It is very affordable. Think about it. If you passed away today, would your family be financially prepared to face the future?
I want my family to be able to focus on the next phase of life without having to worry about how they will make the car payment, credit card payment, house payment, and how they will get by without my income. I have taken care of this by obtaining 20-year level term life insurance equal to about 10X my annual income. It is very cheap. You can check the costs at Zander Insurance. You can either buy through Zander or through your local insurance agent.
Do it today.