There is no question that most Americans want to avoid filing bankruptcy at all cost. Although "the B-word" has lost most of its stigma, and some consider filing it casually (some doing it more than once), the vast majority will do anything else first (and some of those options can have some long term consequences).

The irony of this is that bankruptcy is often the best thing for them. Therefore, I want to offer some warning signs to consider, so that you do not wait until it is too late. Ask yourself these three questions. If any of this sounds like you, call a bankruptcy lawyer!

3 Questions to Answer on Whether to File Bankruptcy

1. Are you living within your means?

This may seem like a dumb question, but think about it. Do you have the income every month to cover your basic economic needs, like food, clothing, and shelter? Are you spending money you don't have on non-essentials, thus creating payments on credit card debts that are interfering with your ability to buy groceries?

95% of Americans do not have a household budget. Do you? If you don't, then download this form and prepare a budget of all of your living expenses. Then take the total and deduct it from your net monthly income.

If you come up with a negative number (or money left over insufficient to make the minimum payments on your credit cards), you are living beyond your means and need to curtail spending as soon as possible. Tighten your belt to produce the money needed to pay down the debt, not just put it off for another month. If you can't do that, call a bankruptcy lawyer!

2. Are you taking money from other sources to shore up your budget?

Do you use a debit card, but figure that overdraft protection will catch a shortfall? This is nothing more than taking out another loan and is another way of putting off the inevitable.

The same is true of borrowing against your pension. This is always a bad idea and jeopardizes your future. Don't do it; call a bankruptcy lawyer.

3. Have you stopped answering the phone or opening the mail?

This is another symptom of people in financial difficulty, because it means the bills aren't being paid, and you are hiding from your debt. This can't go on forever and is, in essence, an attempt to hide from the problem. Call a bankruptcy lawyer.

So What Do the Answers Mean?

If you answered No, Yes, and Yes to these questions, then you need to consider a bankruptcy filing. Don't wait until the water is up to your chin to learn how to swim. Seeing these signs early on may allow you to avoid bankruptcy, but ignoring them may make it an inevitability.

Still not sure if you should file? Then take the quiz to the right and find out!

What Do I Do Next?

If you live in Burlington, Camden, Gloucester, Salem or Cumberland County, took the quiz, found out you need to file, and are ready to take action, then call my office at 856-432-4113 or contact me through this site for a free consultation in my Woodbury office to discuss your case.

If you still have questions about whether bankruptcy is the right solution for you, then download my free book, Am I In Too Deep, A Guide to Knowing When You Need to File Bankruptcy in New Jersey.

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Steven J. Richardson
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Bankruptcy, Collections, Student Loan, DUI and Traffic Court attorney in Woodbury, NJ.