How to Avoid Bankruptcy

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Think filing for bankruptcy is the easy way out? Plan to say goodbye to your cell phone, the internet, and anything else the IRS deems a luxury—and suffer a black mark on your credit report for ten years. Get smart and get out of debt the old-fashioned wa

To complete this How-To you will need:

An itemized list of everything you owe
Bank statements
And credit card statements

Step 1: Use cash

Stop using your credit cards and start paying cash for everything.

Step 2: Examine your habits

Examine how you got into debt so you can make the necessary changes. Did you lose your job and not have emergency savings, or are you a shopaholic?

Step 3: Compare income to expenditures

Tally up what you spend each month and compare it to your income. For many people, being in debt is simply a matter of having more money going out than coming in.

Tip: Some banks offer free debt counseling.

Step 4: Lower monthly expenses

Find ways to lower your monthly expenses. Believe it or not, you can survive without cable TV, your morning latte, call-waiting, and the weekly tabloids for a while.

Step 5: Raise cash

Raise some cash -- have a garage sale, get rid of stuff on eBay, give your old clothes and accessories to a resale shop, get a part-time second job -- and apply the proceeds directly to your debts.

Step 6: Let others know

Explain to people in your life that you're trying to pay off debt. They'll be impressed and think of your new fiscal outlook as "responsible" instead of "cheap."

Step 7: Pay down credit cards

Figure out how much you can spend monthly on paying down credit cards. Pay off cards with small balances or the highest interest rates first.

Step 8: Consolidate debt

Consider consolidating your debt by getting a loan that would pay off your revolving debt and leave you with one fixed loan.

Tip: If you are a home owner, you can consolidate your debts with your mortgage, which usually reduces your payments and is now tax-deductible. There may be closing costs attached.

Step 9: Firm your resolve

Resolve never, ever to live beyond your means again.

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[Phonomorph]

How to avoid bankruptcy :

You'll need:

cash.

[Ozzy0sbourne]

getting a credit card is one of the stupidest things someone can do.

[777kingpen]

YOUR MY HERO! until you move into my house next fucking month... lol

[Lorenicities]

How to avoid bankruptcy:

Step 1: Refer to How to Win the Lottery video.

[maxxoccupancy]

Paid for by the banking industry. The big banks value personal honor so highly that they bundle their honorable clients together with their dishonorable and completely broke debtors and sell them off in bundles to other Wall Street firms.

[snager80]

bankruptcy would NEVER have happened if more children had learned to play RPG turn-based strategy games when they were young 30 years ago.

[mmrkk7194]

good point

[Mike019232]

Hmm, I find this weird because the Phoenix Coyotes just filed for bankruptcy. =\