4 Ways On How To Prevent Bankruptcy

The only way to prevent bankruptcy is to have a thorough plan

. In these uncertain times, people are getting desperate. A lot of families are considering bankruptcy. It is not an easy choice and can cause considerable mental anguish. The only way to prevent bankruptcy is to have a thorough plan.

Here are ways you can prevent bankruptcy and save your financial situation:

1. Calculate all your monthly expenses and earnings.

This can be very hard for some people. But it will open up your eyes on how much money you are wasting on needless things. For example, if you are the person that buys coffee from star bucks every day but you can easily make it yourself, you can potentially save at least $200 a month. Although it is not as convenient, it can help you pay off your loans.

2. Create a monthly budget.

When you finish calculate all your expenses and earnings, your earnings should be higher than your expenses. Every month, you should put at least 10% of your money into your savings account. If you keep doing this, you will be surprised how quickly you can accumulate money in a relatively short period.

3. Sell off your assets if you can't pay off your debt in a sufficient amount of time.

You should contemplate on selling off your assets. Record all the assets that you currently have and calculate how much are they worth. Consider selling off all your assets that you don't really need like your boat or lawn mower.

4. Changing your credit card to another company that have a lower interest rate.

If you think you can confidently pay all of your credit card debt in a reasonable time, then its best to get another credit card with a lower interest rate.

5. Find another job. You will need to find a way to earn extra income to pay off your loans.

This may mean working overtime or finding a second job. Currently, the job market is not very good. Therefore, you will need to work extra hard to find work. If you are not sure how to find a job, try to ask family or friends to introduce someone that they know.

In summary, it is best to plan your way out of bankruptcy. Having a pragmatic look at your budget can save you a lot of headaches. If you seriously cannot cope with your situation, perhaps the best thing to do is to declare bankruptcy.You may like it but it would be the only choice you have.

by: Lam Seina

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