As with most issues, the answer to this question is it depends. Income is a huge factor in budgeting. Before your free bankruptcy consultation, attorney Marcia Moellring requests clients fill out a budget worksheet. This allows her to analyze a person’s specific situation and determine if bankruptcy is an appropriate option. Some people can be helped by prioritizing their income distribution or finding ways to cut back expenses. If a creditor action is severe, a chapter 13 repayment bankruptcy might provide needed relief.
Others, who are frustrated by their perceived inability to budget, truly just don’t have enough income to make even the best budget work. Budgets require enough money to meet monthly expenses. Many people are in fact creative jugglers and have become accustomed to not having enough money and spreading payments out between creditors. You might say in fact, they are experts at budgeting.
The problem comes when a creditor takes action that interrupts the debtor’s ability to juggle. When a lawsuit is followed by a wage garnishment, money for food or medicine can end up lower on the priority list than a medical bill judgement. This is when the cycle becomes particularly vicious. Yet, many will still assume they just need a tighter budget. The truth is, they are better at making a paycheck go a long way then those who have always had enough.
When judgments force someone into bankruptcy, many who have gone through it have been surprised at how much better they can breathe when their bankruptcy is discharged. Bankruptcy provides the opportunity for a fresh start and the opportunity to get back to a budget that works.
Marcia Moellring of Moellring & Ambler, LLC has been representing clients in bankruptcy for 25 years in Illinois and Missouri. To schedule a free bankruptcy consultation, contact us at (217) 214-3022 or complete this form and we’ll be in touch.