As we enter another new year, many Americans will ponder financial mistakes they made in the past and what ones they should avoid coming into the New Year. While many Americans usually have some kind of New Year’s resolution, most don’t even last a month before they’re back to their old bad habits. The majority of New Year’s resolutions involve weight loss, drinking and smoking but there are a few old-fashioned folks that want to make resolutions that will improve their psychological and financial well-being. In this world everyone faces a large amount of stress and if we could do something that would alleviate just some of it, most people believe they would be much happier. One of the main causes of stress related illness and plain old worry is money. Some of the lucky ones worry about having too much, but most of us worry about not having enough to make ends meet. Today, the majority of Americans are saddled with debt that they may never be able to pay off in a lifetime. Every year, that number continues to rise and most people don’t consider filing bankruptcy until they can’t make those minimum payments anymore. In this new year people should consider being more proactive even if it requires them to use a bankruptcy filing to get themselves out of debt.
Back in 2008, the real estate market imploded causing the economy to follow suit making many individuals have to file bankruptcy to get out of debt. Some of the people who ended up filing bankruptcy might have been able to avoid the process if they didn’t make certain financial mistakes. One of those mistakes was buying a house that they couldn’t afford. Just because someone would offer them a loan with zero interest for five years, that doesn’t mean they will be able to afford it in the future. At some point in time the note will be due and the payment will double. Fast forward to today, the mistakes that were made prior to the collapse are being made once again. I guess people don’t learn and quickly forget how it affected just about everyone in the world that was caused from the economic meltdown. Common sense tells you, that you can’t afford it and it’s too good to be true. Just like everything else if it seems too good to be true it is too good to be true.
Now, these people have lost their homes to foreclosure and wallowing in their self-pity for making these mistakes. Everyone makes mistakes, the difference between the winners and losers are the winners only make them once. Many more people over the next few years will be filing bankruptcy for similar reasons. Creditors have been pushing money back out to individuals that can’t afford it in hopes of stimulating the economy. History tells us that spending doesn’t revive an economy but saving does. Nothing’s wrong if someone has to file bankruptcy to eliminate their debt. They should just make sure to learn from the mistakes that put them in financial distress. To make it clear, a capitalistic society would not work without having bankruptcy filing available because entrepreneurs would not take chances if they knew they would be saddled with the debt for the rest of their lives.