Looking Beyond Bankruptcy

June 25, 2014

Many people see bankruptcy as their saving grace; they are so far into debt that they don’t see any other option. They make all kinds of promises to themselves that if they can get out of debt, they will never get into debt again. Some of them say they will get a second or third job or turn the household finances over to their spouse.

Without an understanding of their relationship to money, how they use it and how they waste it, a second or third job is not going to prevent the same crisis from happening again.

Let’s say you get the second or third job. If you don’t change your spending habits, the income you get from those extra jobs will make you feel like your problems are over and, before you know it, you will have spent the additional money and even accrued more debt than before.

If you think that you have learned your lesson from this experience and you wouldn’t make the same mistakes that got you into this situation, ask yourself what you would do if you suddenly found yourself with an extra, unaccounted for, five-thousand dollars, and you didn’t owe anyone money. My guess is that you would go right back to your customary spending habits and you wouldn’t think of saving it for an emergency.

It’s easy to think that the experience has taught you that you’re not good with money so you’ll turn over all your household finances to your spouse, but is that fair and do you think that this will be the solution?

First of all, if you haven’t changed your spending habits, all you would be doing is shifting the burden of indebtedness onto your spouse and, second of all, your debts would increase because you would feel so relieved that you aren’t the one who is responsible for paying the bills that you would spend even more money than before.

Having creditors breathing down your back isn’t a guaranty that you have learned your lesson about irresponsible spending. If you don’t change the way you equate your needs with your wants, you will be right back in the same situation as soon as you get a little more breathing room.

It’s an old story . . . if you keep doing the same thing, don’t expect different results.

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