No one looks to get into a financial situation they can't get out of. Perhaps that's why a lot of people in such circumstances often turn a blind eye to the signs that trouble looms. In the words of one credit counseling professional, it is a display of the "ostrich syndrome."
Bankruptcy is one of the options that may be worth considering when conditions warrant. An attorney with experience in that area of the law is the right person to consult about such questions. Ahead of that, however, debt relief experts say there are some warning signs that Texas consumers can look for if they're willing to take their heads out of the sand. Here's a list.
- Bill juggling and constant late fees. Late fees mean you aren't paying your bills on time. If you're paying them all the time, it's money lost. Experts say bill juggling often means paying the minimum on bills and balances don't dwindle that way.
- Pegging hopes on a windfall to come. The inheritance you expect may not be bequeathed. The bonus you think is due may not be issued. And you don't need an expert to tell you that home equity isn't what it used to be.
- Playing credit card Monte. Some consumers in tight situations may employ a strategy shifting balances from card to card. That might work for a while, but experts say it leads to rising balances.
- Debt is a source of ongoing domestic dispute. An occasional fight over money and debt is probably unavoidable for married couples. If they're happening all the time, advisors say it's a sign of trouble and consulting a nonprofit credit counseling service may be in order.
- Chronic NSF notices. The fees you pay for not having enough funds in the checking account are considered a hurricane warning flag to one Florida advisor. He says regular overdrafts means bankruptcy is more likely to follow.
- Zero savings. Advisors say savings should be a budgeted expense like any other. Without some level of savings, even a small amount, you could be brought low by something unexpected.
- Dipping into retirement funds. The experts say this isn't just a sign of trouble now. It's a threat to your future.
With so much at stake, it makes sense to be aware of warning signs.
Source: Bankrate, "8 signs you're flirting with financial ruin," Claes Bell, accessed June 24, 2014