Paying Everything Off: Risk Analysis

If you are able to pay off all your debt, then you probably are not reading this. However, you can imagine that many of my thousands of free bankruptcy consultations are with people who COULD pay off their debt but the cost of doing so would be too great on their lives, health and families.

So, how hard should we fight to pay off our debts? This is a very personal question. Most people would not sell an organ or prostitute themselves to repay their debts. However, should we work 90 hours a week and neglect our families and injure our health? This is the fuzzy line.

The rule I tell my clients is that if they are able to repay their debts in three years, without sacrificing nutrition, health-care, and the bare minimum rest and family time needed to stay healthy; they should fight through and avoid bankruptcy. Just make sure your three year plan is realistic.

However, if paying your debts would take you 10 years or require you to work yourself sick with two or three jobs, or neglect your family, you should let it go and file bankruptcy. The United States Congress believes as much. It is bad for society, much more expensive than the cost of your current debts, if your kids become problematic because you are not around. Don’t forget that it costs society hundreds of thousands of dollars if you get sick and can not work, or get a stress related health problem and end up in the hospital.

This is why, you are encouraged to take a fresh start rather than work yourself to ruin.

I have had people come in for their free bankruptcy consultations who were working three jobs, sometimes single mothers, because they didn’t want to file bankruptcy. Usually they had some great misconception about bankruptcy (see “Bankruptcy Myths“). Years and dollars were wasted for nothing.

If you are working just to pay interest on your debt than something needs to be fixed. You need help. A knowledgeable and experienced bankruptcy lawyer can tell you whether bankruptcy is appropriate for you. Don’t lose your time. Learn your options now.