Bankruptcy Alphabet: Y is for Yoke

Y, in my Bankruptcy Alphabet, stands for Yoke.

Debt is a yoke around the neck of a person. It keeps him harnessed to the weight of past financial decisions and, sometimes, to events over which he had no control.

There are times in life when the right course is to put your shoulder to the wheel and strain through a tough financial task:

live frugally,
postpone expenditures,
be disciplined and
meet the problem on its own terms.

As a bankruptcy lawyer, I don’t see many of those situations.

When someone lets down their defenses enough to schedule an appointment with me, the situation is usually beyond remedying with any amount of hard work.

Persistence isn’t always heroic

As a society, we love stories of the underdog prevailing, of hard work winning out against the odds. We relish the heart warming stories when dogged effort works.

No one writes the stories of the horde of people for whom that wasn’t a solution.

For lots of people, all that dogged devotion to making minimum payments yields in the end is a further set of bad decisions: going without insurance, emergency funds, or retirement savings.

This is true grit

It takes courage and humility to say you’ve found yourself in a situation for which grit simply won’t win out.

It also takes the ability to lift your perspective from month to month survival to a vision of decades: where are you financially two or three decades from now if you are still paying down today’s debt?

Take a look at my exercise in paying down $20,000 in credit card debt by making minimum payments. See what it really costs in dollars and lost opportunities.