Personal bankruptcy can be a great way to shed yourself of unwanted and overwhelming debt. By doing so, you may be able to reclaim your financial freedom as you start the next chapter of your life. But when most people think of bankruptcy, they think of middle-aged individuals who have faced the unexpected onset of a medical condition, the loss of a job, or a costly divorce. Yet, divorce has no age requirements.
Is bankruptcy right for young people?
Bankruptcy can certainly be appropriate for young people who find themselves overwhelmed with debt. However, the biggest form of debt that many young people face is that pertaining to student loans. Unfortunately, discharging student loan debt through bankruptcy is extremely challenging. This fact shouldn’t deter young individuals from considering bankruptcy, though. After all, freeing one’s self of other debt can free up money to get a better handle on student loan debt.
This means that you may be able to get rid of medical debt, credit card debt, and even a mortgage if you’re feeling completely overwhelmed. Doing so now could actually save you a lot of time and struggle by foregoing what could be years and decades of tirelessly trying to pay off your bills without making much progress.
Are there disadvantages?
There are a few, but they’re not as major as many people think. For example, a bankruptcy will show up on a your credit report for some time to come and your credit score will therefore take a ding. But there are things that you can do to build your credit score. Others worry about the stigma associated with filing for bankruptcy. You shouldn’t be concerned here. Millions of people have sough bankruptcy protection and successfully moved on with life. You can do that, too.
Information is power. You can’t make the decisions that are right for you until you know how the bankruptcy laws apply to your circumstances. That’s why it’s often best for those who are struggling with debt to discuss their financial situation with a legal professional who can help inform them and guide them through the process, advocating for their best interests along the way.