Asked & Answered
Am I Bankrupt?
Q -I make $70,000 per year and owe $20,000 in credit cards, $15,000 on a car, and $20,000 in student loans. Would it make sense for me to declare bankruptcy and start over?
A - No. You are not bankrupt, just in debt. First of all, your student loans will not go away even when you declare bankruptcy. Second, you will probably only get a chapter 7, which is a restructure, not an elimination of debt.
You bring home about $3,600 per month, and owe $600 in credit cards? You just need to control your spending, possibly sell your car and get something a little more in line with your spendable income for about a year or two, and make some small sacrifices, such as packing your lunch, skipping out on expensive coffee, etc. and pay down your credit card debts.
Remember, when you borrow money, you are agreeing to use someone else’s money today, and giving them your money tomorrow, plus interest. You now have to pay back what you borrowed. Consider it a lesson learned, and lay off the credit cards. |
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