Are you losing sleep because you owe debts that you cannot pay? Do you worry so much about the debts you owe that you cannot enjoy your life or your family? Are you overwhelmed and feeling like there’s no way out? Are you thinking that you might need to speak to a lawyer about your situation but wondering how much it will cost you? If this is the situation confronting you, here are my suggestions for what you can do right now to begin to get your financial house in order. These suggestions are based upon many years of counseling individuals and families and helping them take back their lives from the crushing pressures of debt.
First, don’t despair and understand that there is a real and legal way out. Right now, it’s less important to think about how you got here. The fact is that you are here and you’ve got to start thinking about how you’re going to get out of this situation.
Assess Your Situation
Second, grab a pencil and some paper and a calculator. Add up all of your income on a monthly basis. Write that figure down. If your income is not always the same each month, look over the past six months and take an average. Write down the average figure.
Figure Out Your Fixed Expenses
Third, take a look at the “fixed” amounts of your monthly expenses. These expenses are the same amount from month to month and include, for example, your mortgage or rent payment. Another example would be your car payment or a payment on an installment loan. Add all of these expenses together and write that figure down.
Gather Other Monthly Expenses
Fourth, take a look at what you are spending each month on food, electric and/or gas utility services, clothing, automobile expenses (excluding your car payment), insurance, cell phone usage, medications and healthcare expenses, and all other necessary expenses. Add all of these expenses together and write down that figure.
Gather Non-Fixed Expenses
Fifth, take a look at your non-fixed expenses like credit card payments, recreation and other monies you are spending each month. You may think that credit card payments should go in the “fixed” expense category based on the minimum payment due each month. If you owe credit card debts and you routinely pay only the minimum amount due, this is a good indicator that you need help. Add all of your non-fixed expenses together and then write this amount down.
Add It Up!
Now, compare all the expense figures against your total income. If your expense figures exceed your income, it’s time to get help. Unless your current situation is temporary and either your income is about to go up or your expenses about to come down, your situation will only worsen over time. If you have at least enough income each month to cover your reasonable and necessary living expenses plus a little extra, you may be a good candidate for a Chapter 13 debt consolidation. Or, if not, perhaps a Chapter 7 bankruptcy case is the best option for you. Either of these options will lead to permanent and legal debt relief. An experienced debt relief lawyer is necessary to help you make this call.
Contact a Lawyer
If you are facing an immediate loss of property such as a foreclosure on your home, repossession of your vehicle, or garnishment of your bank accounts or wages, you should immediately consult with a reputable debt relief attorney to identify your options and take proper legal action. Time is of the essence in these situations. Delays when faced with these problems very often lead to substantial and irrevocable loss of property. Very often, your first consultation with a reputable and competent debt relief attorney is completely free of charge.
So, if you’re feeling overwhelmed by debt, take heart and understand that real help is available. Realistically assess your situation and get competent legal advice sooner, not later. By doing this, you will be able to identify your options and take appropriate action. And I promise that you will feel better. You might even start sleeping again.
Ed Woods is the Managing Attorney of several of the Bond & Botes Law Offices throughout Mississippi. He holds a Bachelor of Science from the University of Southern Mississippi, and a Juris Doctorate from Mississippi College School of Law. Ed puts his extensive knowledge of bankruptcy law to use defending consumers from debt collection lawsuits and more. Read his full bio here.