In this day and age, students prefer using their credit card for every type of purchase without thinking that they might have to deal with bankruptcy.
The expenses can range from food bought from your average store to an expensive personal computer purchased online.
As with all teenagers, the problem is that responsibility is still something they struggle with. Using the credit card for every type of investment they deem to be important and skipping on paying debts is a sure sign that one day they will have to deal with bankruptcy.
Other students use their tax money to buy useless things instead of… well, paying their taxes. And before they know it, they are facing bankruptcy.
That’s the moment when they’ll start to panic and they have to take some responsibility for their actions.
How to Deal with Bankruptcy
- A good way to start is to ask advice from an expert. Most certainly, you don’t know how to address the increasing number of debts and taxes, so you are better off asking someone who knows. Throwing the credit card in a thrash bin and getting a new one isn’t a solution.
- Another way to deal with bankruptcy is to have a personal debt agreement with your creditors. In other words, you will sign a contract stipulating that you will pay an agreed sum of money over a specified period. This will ensure that you will have better control over your money. At the same time, it will make sure that you will pay your debts and that you will do it on time. This is a second chance so try not to blow it.
- In case your creditors refuse a personal debt, try to persuade them in accepting an agreement on a lower debt. You still have your debts to pay, but they will be lower so you can pay them without starving. This also means that your period of repayment will be extended for another year or two, depending on your debt and other taxes.
- The final way is just to embrace bankruptcy. In this case, most of your belongings will be auctioned, and the money will be used to pay the creditors. So, for example, if you own a car that costs 20,000 Australian dollars, you can kiss it goodbye. But, if you own a car that is worth less than 7,700 Australian dollars, you can still keep it. The tools that are needed for your daily use and are under the value of 3,750 Australian dollars can also be saved from the auction.
In the end, no matter how much money you have, you should always check your banking history. At the same time, try to think twice before purchasing useless or very expensive things.
If you deal with bankruptcy, remember that it’s not the end of the world. This situation might just make you a little more responsible in your future endeavours that have to do with your credit card.