Filing for bankruptcy is a profoundly personal choice, and one that often comes after significant reflection and analysis of your finances. If you are considering bankruptcy but are unsure if it’s the right move for you, speaking with an experienced attorney can be a big help.

But what if you’re not ready to take your case to an attorney? Maybe you’re not sure if your financial situation really warrants filing for personal bankruptcy. In today’s post, we’ll discuss some factors that could indicate that you are headed toward bankruptcy. These were first shared on the website

Do you have difficulty paying your bills on time and meeting minimum payments? Some signs that might indicate trouble include:

  • Being behind on your car payments
  • Getting calls from debt collectors
  • Having a credit score below 600
  • Relying on high-interest credit sources like payday loans and credit-card cash advances
  • Dipping into your 401(k) and other retirement accounts

You should also examine your spending habits, particularly regarding credit cards. Potential warning signs include:

  • Not knowing how much money you owe in credit card debt
  • Maxing out or nearly maxing out your credit cards
  • Not being able to afford your current lifestyle without the use of credit
  • Spending more than 28 percent of your gross income on rent or mortgage payments
  • Overdrawing your checking account two or more times in the past year

Again, these are potential warning signs and must be taken in context. But if many of these statements describe your current financial situation, you may want to meet with an experienced bankruptcy attorney to further assess your options.

Source: Daily Finance, “10 Signs You Are Headed Toward Financial Ruin,” Ellen Chang, Sept. 19, 2014

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