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Many Miami residents have tried to keep a rainy day fund, money in their savings accounts to have in case the car breaks down, the dog needs a sudden vet visit, or any other unexpected something that suddenly comes up. Several hundred dollars usually do the trick for these expenses, but experts suggest keeping an emergency fund as well in case of job loss or bigger expense that, if not prepared for could lead to bankruptcy.

Of course, coming up with thousands of dollars in case of an emergency is easier said than done, especially when bills are overwhelming. That may be why close to 13% of Americans have either filed for bankruptcy or have seriously thought about it. Between job losses, home foreclosures, divorce and other financial bumps in the road many people, especially those over 50 have decided it is time to get a clean slate through bankruptcy despite the stigma. AARP’s Public Policy Institute show that homeowners over 50 faced foreclosures or 90 plus day delinquencies in record numbers between 2007 and 2011.

Whether a person finds it necessary to file for bankruptcy or not after a divorce, it is important to see that their accounts are separated as soon as possible. If one person hasn’t had credit in their own name, they can often begin to establish it soon after a bankruptcy is discharged in their own name, if necessary, through a secured credit card. In fact, it can be easier after a bankruptcy because creditors know that there it will be several years before filing for bankruptcy will be a possibility once again.

There are many people who put off filing bankruptcy because they see it as evidence that they had made mistakes with their finances. While this may be true, often through admitting those mistakes, starting over, and adopting better savings and money management strategies further financial difficulty can be avoided in the future.

Source: AARP, “How to Recover From a Financial Setback,” Lynnette Khalfani-Cox, Jan. 9, 2013