Bankruptcy Advice: Money Mistakes That Wreak Havoc on Your Finances

October 26, 2011 by  Filed under: Bankruptcy 

We all make mistakes – but if you end up making more than a few mistakes with your finances, you could end up in serious trouble. If the Great Recession taught us anything, it’s that not having a financial plan can lead to irreparable professional and personal disaster. It only takes a few bad money moves to end up swimming in debt, with no hope of recovering without filing bankruptcy. So what are the major money mistakes that will land you in some serious debt? See if you recognize yourself in any of these scenarios:

· You’re putting off saving for retirement. Sure, you may have decades to plan for those golden years – but unless you’re happy with the idea of living on beans in your child’s guest room, then it’s time to make retirement savings a priority. If you’re living paycheck to paycheck and can’t find any spare money to put towards retirement, it may be time to focus on why you’re in such a financial state.

· You don’t have an emergency fund of cash. When people lost their jobs during the market crash, they had no savings to rely on. Instead, they used their credit cards to pay for everything, thereby digging a debt hole so big that it was impossible to jump out of. If you’re having a hard time saving up your money because of credit card debt, then it is time to seriously review your financial situation.

· You don’t keep a budget. If you don’t know where your money’s disappearing to, then it’s time to start keeping a budget. While some individuals may treat a budget as a four-letter word, the truth is that budgeting can make the difference between a financially secure family – and one that’s teetering on the brink of financial disaster. Don’t let the latter happen to you.

· You’re buying more than you can afford. It’s tempting to live outside of your income – especially when credit cards make it so easy – but this money mistake only propels you into a cycle of debt that’s hard to crawl out of. Keep your spending within your income, and you won’t have to worry about the bills piling up.

Avoid these money mistakes, and your finances will be golden. However, if you’ve already found yourself in one or more of these financial traps, then it might be time to contact a local bankruptcy attorney. Getting rid of your unsecured debt with a Chapter 7 bankruptcy might just give you the opportunity you need to start over again financially – and never end up making these money mistakes again.

Reed Allmand, sponsoring attorney for, is constantly looking for ways to provide the best financial information for his clients. Whether you are considering filing for bankruptcy, or are currently going through a Chapter 7 or Chapter 13, visit for up to date news and information you need to know.

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