If you suspect that you have too much debt, you’ll know for sure after you get through reading this article. Debt is a formidable foe. It can take away our happiness and cause you to live in constant frustration and fear. It is best to deal with debt by tackling it head on and using any extra money that you come across to pay it down. If you have some debt, but aren’t sure if it is out of control, taking a few minutes to see if the following statements apply to you will give you a good idea of whether you are in trouble or not. .

1. You are relying on credit cards to cover your basic needs: If you have to rely on debt to cover your basic needs such as food, clothes and shelter, then you are likely in trouble.  Your income should cover your basics and you should not need your credit cards. However, if you can not afford to pay your bills without credit cards, it may be time to sit down with  a professional  and come up with an alternative plan.

2. You are using credit cards to make payments on other credit cards: Using credit cards to pay off other credit cards can quickly become a vicious cycle. If you don’t have enough money to make the minimum payments on your credit cards, it may be time to work with a debt consolidation company.

   In many cases, they will be able to help lower your interest rates and decrease your monthly payments. If you find that this does not save you enough money, you may need to do something more drastic such as bankruptcy.

3. You have no savings: If no matter how much you cut back, you still don’t have enough money to put into savings, you may need to call a professional such as a licensed financial counselor. They may be able to help you come up with a budget and give you some tips to ensure that you are able to save.

   Paying yourself every month and working with a debt consolidation company to lower your credit card payments might be a good place to start.

4. You accumulate overdraft fees every month: If you are bouncing checks every month, you either aren’t bringing in enough income, you’re not following a budget or you are financially unorganized. If you don’t believe that you can pull things together yourself, you may need to sit down and talk to a professional. Again, a certified, financial counselor or a debt consolidation company will be able to point out where you may be wasting money so that you can live within your means.

5. You have high balances on your credit cards and are only able to make the minimum payments: Being only able to make the minimum payments on your credit cards essentially means that you will be in debt for years. If your debt is substantial, you may be paying back your credit cards for the rest of your life. If you just have enough money to make the minimum payments, it’s time to bring in the professionals.

Debt consolidation might be a good option because they are often able to negotiate lower interest rates, get late fees waived and perhaps even get you a lower payoff amount. If you are in substantial debt, such as in the high five figures range, you may want to consider bankruptcy. This should only be considered as a last resort, but if you are struggling just to make the minimum payments, you are already in trouble.

Although bankruptcy sounds tempting, there are a number of reasons that you should avoid bankruptcy if at all possible.  Having too much debt is a problem that many folks face in the tough economic climate of today.  If you are saddled with too much debt, there are some viable alternatives for you to consider that can help you to avoid bankruptcy.  Debt consolidation and debt settlement are two techniques that many financial advisors recommend to those who are considering bankruptcy.  Never jump straight into bankruptcy without considering the alternatives that can help you to avoid bankruptcy in the first place.  Reasons that you should avoid bankruptcy whenever possible include:

• Bankruptcy destroys your credit rating.  Sure, you may qualify for a loan again within several years.  But that notation of bankruptcy is going to remain on your credit file for up to a decade, a seething black mark against you that creditors and lenders don’t want to see.  You won’t qualify for a home or car loan anytime soon if you don’t take steps to avoid bankruptcy.

• Bankruptcy has lasting implications.  Your credit will be in the tank if you file bankruptcy, that’s a given.  But what about when you want to rent an apartment or get a job that requires a credit check?   Many employers and landlords do require that you agree to a background and credit screening prior to renting to you or to hiring you.  They don’t hire or rent to people who demonstrated their willingness to walk away from their financial responsibilities by filing bankruptcy.

• Bankruptcy does not wipe out all of your debts, and it doesn’t always protect your assets.  Depending on the state where you live and the bankruptcy chapter that you file, bankruptcy is not a cure-all answer to getting rid of debt.  In fact, in some states, your home and vehicle are not protected from lenders when you file bankruptcy, and can be seized and sold to pay off your outstanding debts.

• Bankruptcy is not your only option.  In previous decades, bankruptcy was the only option that borrowers who were loaded with too much debt had at their disposal. That is not the case today. As mentioned above, debt consolidation and debt settlement are two alternatives to avoid bankruptcy that should be looked at before deciding if bankruptcy is right for you.  AvoidBankruptcyToday.Com can help you determine which of these bankruptcy alternatives is best for your situation.

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