It’s not a bad economy, poor budgeting skills, or credit card interest that keep you from getting out of debt.
It’s emotions, not reasons, keep people from filing bankruptcy and starting fresh.
Even if Reason says that you’ll never pay your debts off in the usual way.
Reason also says that paying old debt steals from essential current and future needs.
But emotions stand between you and a rational decision that repayment isn’t possible and that bankruptcy is the solution.
It’s not as sexy as the seven deadly sins, but the Emotions Trio keep my clients mired in debt long after logic says “start over”.
Meet Fear, Stubbornness, and Pride. They stand between you and freedom from old debt.
Fear of the unknown probably kept our primitive ancestors alive. If you didn’t understand it, it made sense to fear it.
In the age of the internet when nothing remains unknown, it’s ironic that fear continues to keep people from filing bankruptcy.
- People fear life in a consumer society without credit.
- They fear being branded as a failure.
- They fear the judgment of others about how they got in this mess.
Some of this fear is rooted in bad information that circulates;. Some of that bad information is deliberately planted by those who profit as long as you avoid the bankruptcy remedy.
I’m with Franklin Roosevelt: all we have to fear is fear itself.
It’s hard to knock stubbornness. After all, stubbornness, the drive to finish what you started, is often a virtue.
But stubbornness regardless of the facts is not admirable.
I’m talking about the attitude that says “these are my debts, and by d***n, I’ll get them paid”.
Honorable, but not rational.
See how long it takes to pay off a modest credit card balance by paying the monthly minimum.
Life is about choices, and the choice to keep chipping away at a Mt.Rushmore of debt usually means that some other, real and important, need goes unmet. The greatest of these neglected choices, in my world, is retirement savings.
Staying in debt means living with stress, or dying of stress.
I’m not the kind of person that files bankruptcy, I often hear.
- people who’ve gotten sick, even with health insurance;
- people who’ve divorced;
- people who’ve lost jobs; and
- people who got suckered into believing that the marvels of a consumer society were available to everyone.
Pride won’t put food on the table in your old age. It won’t pay for your prescriptions or your kids’ college.
Bankruptcy is not a moral failing; it’s a legal solution to an economic problem.
Look around at the celebrities and the iconic corporations who have all filed for bankruptcy relief. Do we think that they are lesser people for starting over? Not usually.
Walt Disney, one of our more famous bankruptcy debtors, is an American hero.
Perhaps the saddest things I see as a bankruptcy lawyer are people who struggled far too long with intractable debt, making more bad choices before getting out from under.
It doesn’t have to be so.