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5 Things You Must Know Before Filing Bankruptcy

5 Things You Must Know Before Filing Bankruptcy

It’s the first day of the month and millions of Americans are not only experiencing payday but pay out day. Rent, car payments, mortgages, and so many other bills have many Americans dreading the first few days of the month.

Why is it that paying bills is so dreadful? Perhaps it is because 38.1% of Americans are in debt and every year approximately 1.2 million have been forced to file bankruptcy for a host of reasons including unemployment, large medical expenses, seriously overextended credit, and marital problems.

You Will Still Have to Pay Your Student Loans

Bankruptcy has continued to be a popular trend for those who find themselves in loads of debt and feel as if filing bankruptcy is all they need to do in order to obtain relief. One misconception that many people seem to have about filing for bankruptcy is that it will save them from having to pay off their student loans. While that would be an exciting benefit of filing for bankruptcy, it is not one of them. In fact, a student loan is the one thing that cannot be forgiven in bankruptcy.

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Before jumping the gun, it is vital that you do some research. In fact, many banks offer educational portals online that allow customers and consumers to do their research before making any decisions that can impact their finances. If after all of your research you determine you are ready to file for bankruptcy, there are a few things that bankruptcy lawyers suggest that you avoid doing:

1. Obtaining new Debt

Do not acquire more credit card or other types of debt if you are within 70-90 days of filing bankruptcy. If you choose to obtain new debt and later file for bankruptcy, that creditor has the ability to object to your request.

It can simply be discharged because the creditor can argue that they didn’t approve your loan with the knowledge that you had not intended to pay it back.

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2. Transferring Money

When you file for bankruptcy you are often asked to provide information regarding any assets you have, or will soon have, in your possession. Many people walk into bankruptcy so fearful that they operate in panic and end up selling or transferring assets out of their names in order to avoid losing the few assets they have remaining.

While this may seem smart to the individual who is filing bankruptcy, it is illegal to hide assets. Not only could your bankruptcy be denied but you would be putting yourself at risk for criminal penalties.

3. Paying off any Creditors

Many bankruptcy experts encourage individuals not to pay back loans or other creditors within 90 days of filing bankruptcy. If you do, you may be eligible for a preferential transfer.

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This can easily be undone once you file for bankruptcy. The trustee leading the bankruptcy can use this preferential transfer to help you get money back from the individuals that you paid off prior to your bankruptcy.

4. Cashing out Your Savings

Many people will attempt to cash out their savings as another way to hide money from their bankruptcy trustee or creditor but the joke may, in fact, be on them.

If you are caught cashing out your savings, you risk criminal prosecution. While saving a few assets may be important to you today they won’t serve any purpose if you are a convicted felon.

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5. Delaying the Process

If you have sought professional advice and it has been determined that you should file for bankruptcy, find out how long you should or should not wait and then take action. In some cases, you can run into bigger problems if you delay your filing.

Featured photo credit: economynewswire.com via economynewswire.com

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Last Updated on September 18, 2020

13 Helping Points When Things Don’t Go Your Way

13 Helping Points When Things Don’t Go Your Way

For the original article by Celestine: 13 Helping Points When Things Don’t Go Your Way

“We all have problems. The way we solve them is what makes us different.” ~Unknown

“It’s not stress that kills us, it is our reaction to it.” – Hans Selye

Have you ever experienced moments when things just don’t go your way? For example, losing your keys, accidentally spilling your drink, waking up late, missing your buses/trains, forgetting to bring your things, and so on?

You’re not alone. All of us, myself included, experience times when things don’t go as we expect.

Here is my guide on how to deal with daily setbacks.

1. Take a step back and evaluate

When something bad happens, take a step back and evaluate the situation. Some questions to ask yourself:

  1. What is the problem?
  2. Are you the only person facing this problem in the world today?
  3. How does this problem look like at an individual level? A national level? On a global scale?
  4. What’s the worst possible thing that can happen to you as a result of this?
  5. How is it going to impact your life in the next 1 year? 5 years? 10 years?

Doing this exercise is not to undermine the problem or disclaiming responsibility, but to consider different perspectives, so you can adopt the best approach for it. Most problems we encounter daily may seem like huge issues when they crop up, but most, if not all, don’t have much impact in our life beyond that day.

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2. Vent if you have to, but don’t linger on the problem

If you feel very frustrated and need to let off some steam, go ahead and do that. Talk to a friend, complain, crib about it, or scream at the top of your lungs if it makes you happy.

At the same time, don’t get caught up with venting. While venting may temporarily relieve yourself, it’s not going to solve the problem ultimately. You don’t want to be an energy vampire.

Vent if there’s a need to, but do it for 15 to 20 minutes. Then move on.

3. Realize there are others out there facing this too

Even though the situation may be frustrating, you’re not alone. Remember there are almost 7 billion people in the world today, and chances are that other people have faced the same thing before too. Knowing it’s not just you helps you to get out of a self-victimizing mindset.

4. Process your thoughts/emotions

Process your thoughts/emotions with any of the four methods:

  1. Journal. Write your unhappiness in a private diary or in your blog. It doesn’t have to be formal at all – it can be a brain dump on rough paper or new word document. Delete after you are done.
  2. Audio taping. Record yourself as you talk out what’s on your mind. Tools include tape recorder, your PC (Audacity is a freeware for recording/editing audio) and your mobile (most mobiles today have audio recording functions). You can even use your voice mail for this. Just talking helps you to gain awareness of your emotions. After recording, play back and listen to what you said. You might find it quite revealing.
  3. Meditation. At its simplest form, meditation is just sitting/lying still and observing your reality as it is – including your thoughts and emotions. Some think that it involves some complex mambo-jumbo, but it doesn’t.
  4. Talking to someone. Talking about it with someone helps you work through the issue. It also gets you an alternate viewpoint and consider it from a different angle.

5. Acknowledge your thoughts

Don’t resist your thoughts, but acknowledge them. This includes both positive and negative thoughts.

By acknowledging, I mean recognizing these thoughts exist. So if say, you have a thought that says, “Wow, I’m so stupid!”, acknowledge that. If you have a thought that says, “I can’t believe this is happening to me again”, acknowledge that as well.

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Know that acknowledging the thoughts doesn’t mean you agree with them. It’s simply recognizing the existence of said thoughts so that you can stop resisting yourself and focus on the situation on hand.

6. Give yourself a break

If you’re very stressed out by the situation, and the problem is not time sensitive, then give yourself a break. Take a walk, listen to some music, watch a movie, or get some sleep. When you’re done, you should feel a lot more revitalized to deal with the situation.

7. Uncover what you’re really upset about

A lot of times, the anger we feel isn’t about the world. You may start off feeling angry at someone or something, but at the depth of it, it’s anger toward yourself.

Uncover the root of your anger. I have written a five part anger management series on how to permanently overcome anger.

After that, ask yourself: How can you improve the situation? Go to Step #9, where you define your actionable steps. Our anger comes from not having control on the situation. Sitting there and feeling infuriated is not going to change the situation. The more action we take, the more we will regain control over the situation, the better we will feel.

8. See this as an obstacle to be overcome

As Helen Keller once said,

“Character cannot be developed in ease and quiet. Only through experiences of trial and suffering can the soul be strengthened, vision cleared, ambition inspired and success achieved.”

Whatever you’re facing right now, see it as an obstacle to be overcome. In every worthy endeavor, there’ll always be countless obstacles that emerge along the way. These obstacles are what separate the people who make it, and those who don’t. If you’re able to push through and overcome them, you’ll emerge a stronger person than before. It’ll be harder for anything to get you down in the future.

9. Analyze the situation – Focus on actionable steps

In every setback, there are going to be things that can’t be reversed since they have already occurred. You want to focus on things that can still be changed (salvageable) vs. things that have already happened and can’t be changed. The only time the situation changes is when you take steps to improve it. Rather than cry over spilt milk, work through your situation:

  1. What’s the situation?
  2. What’s stressing you about this situation?
  3. What are the next steps that’ll help you resolve them?
  4. Take action on your next steps!

After you have identified your next steps, act on them. The key here is to focus on the actionable steps, not the inactionable steps. It’s about regaining control over the situation through direct action.

10. Identify how it occurred (so it won’t occur again next time)

A lot of times we react to our problems. The problem occurs, and we try to make the best out of what has happened within the context. While developing a healthy coping mechanism is important (which is what the other helping points are on), it’s also equally important, if not more, to understand how the problem arose. This way, you can work on preventing it from taking place next time, vs. dealing reactively with it.

Most of us probably think the problem is outside of our control, but reality is most of the times it’s fully preventable. It’s just a matter of how much responsibility you take over the problem.

For example, for someone who can’t get a cab for work in the morning, he/she may see the problem as a lack of cabs in the country, or bad luck. However, if you trace to the root of the problem, it’s probably more to do with (a) Having unrealistic expectations of the length of time to get a cab. He/she should budget more time for waiting for a cab next time. (b) Oversleeping, because he/she was too tired from working late the previous day. He/she should allocate enough time for rest next time. He/she should also pick up better time management skills, so as to finish work in lesser time.

11. Realize the situation can be a lot worse

No matter how bad the situation is, it can always be much worse. A plus point vs. negative point analysis will help you realize that.

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12. Do your best, but don’t kill yourself over it

No matter how bad your situation may seem, do your best, but don’t kill yourself over it. Life is too beautiful to worry so much over daily issues. Take a step back (#1), give yourself a break if you need to (#6), and do what you can within your means (#9). Everything else will unfold accordingly. Worrying too much about the outcome isn’t going to change things or make your life any better.

13. Pick out the learning points from the encounter

There’s something to learn from every encounter. What have you learned from this situation? What lessons have you taken away?

After you identify your learning points, think about how you’re going to apply them moving forward. With this, you’ve clearly gained something from this encounter. You’ve walked away a stronger, wiser, better person, with more life lessons to draw from in the future.

Get the manifesto version of this article: [Manifesto] What To Do When Things Don’t Go Your Way

Featured photo credit: Alice Donovan Rouse via unsplash.com

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