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Debt is more than money owed. For some people it becomes a downward spiral that consumes your life, your health, and your loved ones while you work extra hard. Sometimes you can’t fix the problem on your own. Declaring bankruptcy can mean a clean start, but it’s a bold life choice and it’s hard to know when it’s the right time to file.

Here are five signs that bankruptcy may be the right choice to keep what assets you have and to keep your family afloat through today’s hardship.

  • You’re using credit cards to pay off other debt, increasing what you owe by the month.
  • You’re paying the minimum (or less) on monthly payments.
  • Creditors are relentlessly calling you.
  • Car repossession or home foreclosure is looming.
  • Your health is suffering because of worry, stress and exhaustion.

Bankruptcy options

There are different levels of bankruptcy, most commonly Chapter 7 and Chapter 13, which provide debt relief without taking everything you have. Credit scores can be rebuilt, but your family and life cannot.

  • Chapter 7 seeks a quick reboot, wiping debt clean but often costing assets in the process, such as the sale of a home and car, often replaced with cheaper options.
  • Chapter 13 seeks to repay debts and to keep a home from foreclosure. This is accomplished through a detailed multi-year payment plan for the accumulated debts.

Choosing the best option depends on your current assets, unique circumstances, and the timing of filing. It’s never an easy decision, but sometimes it’s the best approach to secure what you’ve built up so far without hitting rock bottom first. An attorney can advise on personal scenarios after reviewing assets, income, and debt owed to see what filing will put you on the best track going forward. If you’re sinking in debt, the best thing to do is to get out of the water.