Archive for March, 2013

When Finances Crumble, Our Columbia Bankruptcy Lawyers Help

Nearly half of all American households are just one unexpected emergency away from financial ruin.

That’s according to a recent report from the Corporation for Enterprise Development, and our Columbia bankruptcy attorneys know that this precarious situation has many people essentially living on edge. They don’t have enough to cover even basic living expenses for a period of three months if something unexpected happened, such as a serious illness or job loss.

What’s more, nearly a third of Americans keep no savings whatsoever.

It’s not that these individuals are lazy or don’t have the foresight. It’s that they are unable to put anything away. Most of these people have jobs. In fact, three-fourths are working full-time. More than 15 percent of them earn salaries of more than $55,000 annually. Yet, they are still living paycheck to paycheck.

You have a lot of converging factors. These include stagnant wages, high credit card debt and overall skyrocketing prices on everything from groceries to gas.

The good news for those who do hit an unexpected financial snag, a chapter 7 bankruptcy can be the turning point. It will allow you to virtually wipe the slate clean and walk away free of most of your outstanding debt. It’s literally been a lifeline for those who bottomed out in the midst of the housing crisis and recession.

Even as we inch toward recovery, many are still struggling, and bankruptcy continues to help thousands of families get back on their feet.

Still, it’s certainly not something you want to enter into lightly. As such, you want to consider whether there are other steps you can take before you reach this point.

So if you’re facing a financial crisis, the first thing you’ll likely need to do is prioritize. Make a list of all your household expenses in order of importance. Depending on your situation, your list might start with your rent or mortgage, followed by food and utilities, then health care costs and insurance and rounded out by student loans and any other debts. The list will look different for everyone. Some might need to put medication costs higher on the list, for example. Either way, this step is important in determining what you might  be able to eliminate.

In some cases, you may be able to ask your creditors for an extension to better be able to pay. Many times, though not always, they will acquiesce. If you can meet with a low-cost or non-profit financial adviser to help you work through some of this, it could be extremely beneficial.

You’ll want to see if there are any expenses you can significantly trim or do without entirely. Reduce your cell phone plan or cancel your Netflix account. Get yourself down to the bare bones.

With all of this in mind, what you don’t want to do is dip into your savings or retirement accounts in order to cover things like credit card debt. The fact is, a bankruptcy will allow you to hang onto that money in the long term, offering a chance to preserve your future financial stability. The fact remains, families wait too long to get help. If your plan requires you to spent years, or even decades, steadily paying down your debt burden, you are likely already in over your head and would do well to speak to an experienced bankruptcy attorney about your options.

If you are considering filing for bankruptcy in Columbia, South Carolina, contact Matthews & Megna today at 877-253-7705.