We are independent & ad-supported. We may earn a commission for purchases made through our links.

Advertiser Disclosure

Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.

How We Make Money

We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently from our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

Should I File for Bankruptcy?

Malcolm Tatum
Updated May 17, 2024
Our promise to you
WiseGeek is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At WiseGeek, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

The decision to file for bankruptcy is one that should not be made in haste or without a great deal of thought in advance. Unfortunately, there are people today who see bankruptcy as an easy way to resolve financial woes and do not consider alternatives that could work just as effectively. If you are wondering if you should file for bankruptcy, here are some things you should consider before making your final decision.

In the best of situations, bankruptcy is intended to assist people who find themselves in adverse financial circumstances that have become overwhelming. There are several good indicators that you either are on the way or have already reached a state where bankruptcy is at least a viable option. One of the most common signs has to do with the status of your current outstanding debt.

People who choose to file for bankruptcy are often behind on making payments on loans, mortgages, and credit cards. There may be some effort to cover these late payments by transferring balances to other cards or to borrow cash off one card to catch up the payments on another card. When coupled with the regular use of credit cards to pay for necessities such as food without having the ability to pay off those balances within a reasonable amount of time, there is a strong chance that bankruptcy may be worth considering.

Other indicators that point toward the feasibility have to do with general finance issues. When assets such as cars and homes are currently worth less than the balances on the loans associated with the assets, there is evidence of severe financial trouble. If the situation has progressed to the point that it is almost impossible to afford home and auto insurance due to the debt load, it may be wise to declare bankruptcy and obtain some relief.

When unanticipated circumstances have led to financial instability, the decision to file for bankruptcy may be the right one. For example, someone who has experienced a severe accident may not be able to work for an extended period of time. Without a steady income, savings are quickly exhausted. There remains nothing left to pay for utilities, rent, the mortgage or handle the portion of hospital bills not covered by health insurance. People who are in situations of this type may find that declaring themselves bankrupt is the best solution.

There are other considerations that may come into play when deciding whether or not to file for bankruptcy. Constant calls from creditors and collection agencies indicate that the debtor may need to consider seeking legal protection from the creditors. Debtors who are paying extravagant interest rates due to habitually making late payments may also consider bankruptcy as the only way to get out of debt and make a fresh start. If there is a garnishment on wages and salary, that is a definite sign that bankruptcy should be considered.

It is important to recognize that choosing to file for bankruptcy does not mean that once the court of jurisdiction approves the plea that everything can continue on as before. While many people do declare bankruptcy because of extreme and unforeseen financial circumstances, it is more common for people to end up in a bankruptcy court for no reason other than poor financial management. If this is the case, the decision to file for bankruptcy must be coupled with a commitment to seek professional assistance to learn and implement sound financial accounting principles so that there will never be a need to go through the process of bankruptcy again.

WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Malcolm Tatum
By Malcolm Tatum , Writer
Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing to become a full-time freelance writer. He has contributed articles to a variety of print and online publications, including WiseGeek, and his work has also been featured in poetry collections, devotional anthologies, and newspapers. When not writing, Malcolm enjoys collecting vinyl records, following minor league baseball, and cycling.

Discussion Comments

Malcolm Tatum

Malcolm Tatum


Malcolm Tatum, a former teleconferencing industry professional, followed his passion for trivia, research, and writing...
Learn more
WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.

WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.