Alternatives To Bankruptcy

2006-08-18

Since the introduction of the bankrupcty law in 2005 that makes it harder for Americans to get out of debt, a number of people are looking for alternatives to bankruptcy. Statistics from 2004 show that more than 1.5 million bankruptcies were filed in the US. Compare this to 1994, when only 800,000 bankruptcies were recorded. What this shows is that the number of bankruptcies that are being filed each year have doubled since the mid 1990s. Many experts believe that the increase in bankruptcies are a result of baby boomers attempting to relieve themselves of debt as they near retirement.

Historically, bankruptcies were often attributed to young people who did not have a large amount of wealth, good credit, or assets. However, older Americans are now using it as an avenue that can allow them to get out of serious debt. A large percentage of Americans are under the impression that bankruptcy is the only way for them to get out of a difficult financial situation. Not only will filing for bankruptcy ruin your finances for years to come, it has also become difficult to file with the introduction of the new law. If you are considering filing for bankruptcy now, it is important for you to understand what got you into this situation in the first place.

Was it something you couldn't control, such as a medical emergency, or was it something you could control, like putting too much money on your credit card? Whatever the reason for your current dilemma, it is important for you to make sure it doesn't happen again. For those of you reading this article that have been fortunate enough to avoid gaining large amounts of debt, you should take the necessary steps to make sure you are protected. Avoid the heavy use of credit cards and make sure you are insured. Having said that, there are a number of alternatives to bankruptcy that you will want to look at before you make a decision.

Read Part 2 of Alternatives To Bankruptcy

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