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If you are having financial difficulty, and are possibly contemplating personal bankruptcy, that does not mean in any way you are a bad person. It happens to the very finest of people. It is not a reflection of your character. You are still of immeasurable worth, says the Founder of youneedabudget.com, Jesse Mecham.
He articulates seven ways to avoid personal bankruptcy, in this report.
Get a written budget
One way to avoid personal bankruptcy is to immediately get a written budget. You will need to get absolutely intense about your money. Money that is told what to do prior to its landing in your wallet will work harder, last longer, and keep your finances stronger than any other financial move you can make.
Sell your ball and chain
What is causing this extreme financial pressure? Have you purchased too much home? Is your house payment representing 40 per cent of your take-home pay (that is too much)? Do you owe money on any vehicles? Many times, personal bankruptcy can be avoided by people just taking a good, hard look at what they owe and why they owe it.
Cut up your credit cards
In no way – under any circumstances – should you be using credit cards. Destroy them. Cut them up; even the one for “emergencies.” We are talking about ways to avoid personal bankruptcy, not walk right into it.
You might just use it for emergencies. But your definition of an emergency will become much stricter if you don’t have the ability to charge anything in the first place.
Negotiate or surf to lower interest rates
After telling you to cut up your credit cards, surf high-interest-rate balances to new cards. But that doesn’t mean you actually keep the cards. Your object in doing this is to create some short-term positive cash flow.
Getting down to a lower interest-rate will bring you that much closer to avoiding personal bankruptcy. True, you won’t be getting out of debt any faster, but you will be freeing up some cash you may need to get by month to month. Not only will the extra cash help out there, but you will feel better, a little calmer, knowing you have got a bit of wriggle room.
Increase your income
While this may seem a bit obvious, it is overlooked very often. You should not just look at cutting expenses. What can you do to increase the other end of the equation? A part-time job that brings in just extra per month will do wonders for your monthly budget.
Avoid consolidation
Nine times out of 10, this leads you to personal bankruptcy – it doesn’t help you avoid it. Do not fall prey to predatory companies that hunt the weak, desperate, and vulnerable for customers. Focus on increasing your income, cutting your expenses, lowering your rates and selling your junk.
Maintain your perspective
Times are most likely very emotional for you right now. Consult before you decide to make any financial move. Above all, remember that your worth is not tied to your net worth.
source: PUNCH.