Many people in Hervey Bay think that declaring bankruptcy is a very shameful thing. For this reason, even if they know that they are bankrupt, they will not take the step of declaring their bankruptcy. Declaring bankruptcy is not something that you need to be ashamed of because there are so many things that can make you lack the ability to pay your debts. When you learn that you cannot pay your debts, you need to declare bankruptcy to be on the safer side. However, once you accept the position that you are in, you will have the ability to declare bankruptcy without minding what other people will say or think about you. This is because of some of the reasons that lead into declaring bankruptcy are things that you cannot control. The following are some of the reasons that make people reach to the point of declaring bankruptcy in Hervey Bay:
1. Divorce or separation
One of the most leading reasons that make people financially unstable is either separation or divorce. This two factor affects both the partners that are involved in the marriage, and hence no one can escape being bankrupt.
Divorce and separation make people in Hervey Bay loss so much of their wealth in so many ways. For instance the payments that they have to pay as legal fees are very high, the sharing of the assets that the partners owned is also another way, the funds set for the support of the child and also the struggle to make the two families formed after divorce or separation surviving makes many people declare themselves as bankrupt.
At times the legal charges can be very high such that the partners lose so much of their wealth in the cases they have in court. Since children must be supported and the family has to start a new life which is also very hard people find themselves declaring bankruptcy.
2. Excessive and poor credit use
There are also so many people in Hervey Bay who cannot manage the way that they spend their money. For this reason, they use their credit cards to pay bills, take instalment bills and other loans in excess. These individuals reach the point that they cannot make the smallest amount of money that is required to repay the debts since they do not have the capacity of controlling the credit they take. In case they cannot get money from their relatives, friends or take a loan to consolidate their debts, they have no other alternative but declaring bankruptcy.
3. Unexpected expenses
The other reason that makes people declare bankruptcy is the effects of unexpected expenses. During floods, fires, earthquakes or accidents, people lose so much property. In case you do not have coverage for the unexpected costs, nothing is compensated after the loss. A lot of money is required to replace all the things that are lost during such instances while the families involved must acquire their basic needs from other places. Since they have nothing left for them, the best solution is declaring bankruptcy.
4. High medical bills
Some diseases are very rare but also very dangerous. If one of your family members gets such an illness, a lot of funds are required in treating them. For this reason, if the bills are too high, you could end up using all your savings. At times the health coverage can also not have the ability to pay even a portion of the medical bills, yet the patient has to be treated. The only solution that you will be left with is declaring bankruptcy.
5. Termination of a job
Most of the people in Hervey Bay pay their debts and pay their bills from the money that they earn from their jobs. However, when the job is terminated, all these become very hard for them. The situation is even worse because there is no place to get emergency fund and hence you have to use your credit cards for the payment of your bills. This leaves you no alternative but declaring bankruptcy.
For professional advice on how to handle bankruptcy, turn to CLM Accountants in Hervey Bay.