No Money, Now What? Part 2

14 Nov No Money, Now What? Part 2

You know you have a problem; there’s no money to pay the bills. Somehow you are short of cash. And you’ve taken the first step to evaluate what you owe and what you own. Now it is time to figure out where you want to go today.

Set a Goal

You don’t have to see the future to set goals. For just a moment, forget about where you are now. Forget what you think you know about personal finance and bankruptcy. For maybe the first time in a long time, think about where you want to be. What do you want to be when you grow up. What is it that you want to do five years from now and where do you want to be when you are doing it.

That five year goal will determine what path is right for you. Five years is about the maximum anyone can plan. If you were to look backwards five years in time, would you have ever predicted that you would be where you are now?

Remember that every personal situation is different. What is good for your co-worker or neighbor or sibling might not be the right thing for you. With that goal in mind, you can set a path to reach the goal.

The Journey is the Reward

There is no ONE WAY to get where you want to be. In fact, there are many ways to achieve the same goal. Part of planning is to determine a primary route and several backups in case something goes wrong. (You just know something will go wrong.)

With many variations and sidetracks, the choices come down to three basic tracks. The first choice is to do nothing. You might have tried that one already. There is a phrase in a song that I am very fond of, “If you chose not to decide, you still have made a choice.” That’s not to say that doing nothing isn’t always appropriate . In Part 3 to follow, I’ll explain why that is.

The second choice is to find a way to work it out. That wil be covered in Part 4. Working it out can take many forms and there is even a type of bankruptcy that is designed to work out your debt called Chapter 13. Make no mistake, working it out takes a lot of hard work, but it can be rewarding.

The final choice is bankruptcy. That is not to say that it is the worst choice or even that it should only be considered after everything else has failed. But after you have considered all the alternatives and learned as much as you can about personal finance, you will know how bankruptcy might fit into your long term goals. I’ll cover that topic last, but in the meantime, there are many posts here to explain much about bankruptcy.

“ConnecticutGene Melchionne is a bankruptcy lawyer covering the entire State of Connecticut. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.

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