Preventing bankruptcies.

There are some things that can be avoided and bankruptcy is one of them. Read on for action that can be taken to sidestep bankruptcy.

Many bankruptcies can be avoided by practicing good money management. Here are some basic steps you can and should take:

Avoid impulse spending.

Don’t use a credit card unless you have the cash to pay for the purchase in full when the bill arrives.

Prepare a realistic budget and stick to it.

Don’t buy a house that you cannot comfortably afford.

Make sure you’re adequately covered by insurance (medical, homeowners, auto).

Invest wisely and not necessarily on high-risk investments.

Don’t co-sign for a friend or relative with questionable financial habits.

It may happen that you are doing all of the above and find yourself behind on your bills. The best thing to do is call your creditors before you get in too deep. Most creditors will work with you if circumstances such as losing your job, divorce, illness, or such have made it temporarily difficult for you to meet your financial obligations.

Suggest a temporary reduction in your payment, a waiver of late fees or penalties, skipping several payments now and increasing future payments to make up for it, or skipping several payments and adding them to the end of the loan. There is also credit counseling services to help negotiate with creditors, but make sure the business is legitimate and reputable.

You can also do a money search. It is known that 9 out of 10 Americans have unclaimed property. There could be money you are unaware of like an inheritance or savings bond that is now turned over to the state. You have wealth to gain. It is reported that unclaimed money is in excess of $25 Billion dollars.

This entry was posted on Wednesday, March 29th, 2006 at 12:01 pm and is filed under Personal Finance. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.