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Is filing for Bankruptcy wrong – or is it a sin?

The short answer is no.

The Bankruptcy laws are mandated by the US Constitution. The purpose of bankruptcy is to allow you to get a “fresh start.” Often, circumstances beyond our control put you in a position where you become insolvent – you are unable to meet your obligations as they become due. I have met with many people who have stubbornly resisted talking to a knowledgeable lawyer about filing for bankruptcy. Instead, they rely on advice give to them by friends and relatives who have no idea how to spell bankruptcy – much less understand how it works.

200 years ago, there was no Chapter 7 or Chapter 13 bankruptcy. People who were broke were left to survive their financial devastation as bravely and  creatively as they could. Typically, they lost everything and they spent the rest of their life flat broke in a state of hopeless despair.

Thomas Jefferson’s pitiful situation is looked at by many as one of the primary reasons why ¬†Congress took action to enact a federal law – one laws that governs all 50 states. Jefferson died flat broke. He was forced to sell off his prized book collection for a pittance of their value to the Library of Congress. Monticello was ¬†purchased by the US Park service from the bank that had foreclosed on that property.

Henry Ford and Walt Disney both filed bankruptcy several times during their life. They risked and lost – but – they never lost sight of their dream. Had Ford or Disney not been able to file bankruptcy, the Ford Motor Company and the Magic Kingdom of Walt Disney would not exist. Bankruptcy provided them both with the opportunity to get a fresh start and realize their dreams and provide hundreds of thousands of people employment opportunities.

I tell people that bankruptcy is a process of regrouping and putting together a plan for success. You have to treat your personal financial situation just like a business. Budgeting has to become a part of your life. Budgeting is the key to success – it also something that many people never think about.

During our initial intake process starts with your budget. You see real numbers in black and white. Often, we have to perform a forensic audit of your bank statements to see just where your money is going. Many clients are shocked at their lack of knowledge of where their money is going. We bring the painful reality to light and move on from their. It is a tough and grueling but absolutely essential process.

As 2012 draws to a close, make a resolution to review your budgeting practices. You will be grateful for your efforts and you can turn your life around. I see it happen on a daily basis. If you find yourself stuck, call us, come in and let’s get a grip on your budget. It’s never too late to make a move in the right direction. But – the call to action falls on your shoulders. My best advice: Don’t put it off – especially if you are struggling with credit card debt, mortgage payments and care payments. We can help you get a “fresh start” and live the life you deserve.

From my entire staff – please accept our wish for a Happy, Healthy and Prosperous New Year!