Today’s weekend post comes from Financially Poor, who used to be a bankruptcy counselor. One of his most interesting post on his blog is the one question that will change your spending habits.
Bankruptcy isnâ€™t an easy thing to go through emotionally. Having a crap load of debt isnâ€™t easy either.Â Both of those choices arenâ€™t goodÂ for anyone.
Being a bankruptcy counselor I hear a lot of different stories of how peopleÂ got to the point ofÂ filing for bankruptcy.Â Sometimes itâ€™s filled with sad stories about how they were diagnosed with cancer or lost a spouse. Those are very traumatic experiences thatÂ can cause you to get into bad situations orÂ make bad decisions.
Â I also hear stories about people who just got out of control with money and had bad money management. Here are a few common threads that Iâ€™ve noticed in the majority of people that are filing bankruptcy.
Not expecting the unexpected
Things happen in life that you canâ€™t always plan for. But thatâ€™s no excuse for taking life for granted and not expecting the possible. Itâ€™s very possible, especially in this dayÂ and age, to lose your job, or even get hurt or sick. Iâ€™m not saying itâ€™s going to happen but you should have a plan in place in case you loseÂ income in your household.
Hereâ€™s what you should have in place:
Having just thoseÂ two things can help you live a long time without any income.
Credit is a tool used to things that are out of ourÂ immediateÂ reach. Used reasonably it can be very helpful in acquiring things that can betterÂ our life. But if itâ€™s used irresponsibly and more credit is extended to youÂ than you can afford if something happens in your life, then youâ€™ll be in trouble.
Make sure you:
This goes with the overextending, but it also needs its own mentioning. Learn to control yourself. You donâ€™t always need the newest and best thing. Think about how kids love shiny things. Thatâ€™s pretty much what itâ€™s like when you have to have the newest and the best. Learn to live modestly and you will have more than youâ€™ve ever wanted.