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Without Stigma: Using Bankruptcy as a Financial Planning Tool


Most of us have experienced financial challenges at one time or another. And as often as you might hear “oh, it’s just money,” that doesn’t help much when it may feel like there is nowhere to turn, with bill collectors on your back and not enough money coming in to cover costs. Money is tied to so many things in our individual worlds that it’s often very difficult to separate emotion from finances. You might find that you are much happier if you can face your debt head on though, looking at the numbers as just that—numbers—and dealing with them accordingly.

Bankruptcy Allows You to Take Control of Debt

Often this is where bankruptcy comes into the picture, most likely as a final resort, but allowing you to make a future financial plan and look forward to a fresh start. You’ve probably heard of many famous people who have experienced bankruptcy—even more than once—and have gone on to be very successful; however, bankruptcy has historically carried some stigma that is mainly social. You may worry about what friends and family will say if you file for bankruptcy, as well as that infamous black mark on your credit. You could be so worried about what people will say, in fact, that you allow that to keep you from reorganizing your finances realistically. With close to a million people filing each year, you may find that you have more sympathetic company than you expected. Bankruptcy may disrupt your credit score for some time, but multiple debts that are going unpaid and being reported on your credit are just as detrimental, if not worse.

While public perception and a hit to your credit are the downsides (both of which can most likely be fixed in time), the upsides to filing for bankruptcy are that first, you are taking control of the issue. Next, the automatic stay is put into place which means that you have time to catch your breath while creditors and bill collectors are silenced. If you have very little income currently and choose a Chapter 7 bankruptcy, most of your debts such as credit cards and medical debts are discharged, with non-exempt property sold to pay off creditors. Chapter 13 is a more income-based reorganization that will allow you to pay back creditors monthly—and if you are concerned about a mortgage, you may even be able to catch up on payments.

There Are Numerous Chapters in Bankruptcy

While Chapter 7 and Chapter 13 are the most common bankruptcies filed in the US, if you own a business that now requires reorganization, you may want to file a Chapter 11. There are other less common chapters in bankruptcy also such as the Chapter 9 (for municipalities), the Chapter 12 (for farmers and commercial fisherman), and the Chapter 15 (for cross-border cases).

Bankruptcy can be a way to add much greater financial stability to your life in the future. Rather than giving up, it means that you’ve taken the necessary initiative to make improvements and get your personal balance sheet into much better order than it was before.

Contact Us Now

If you are interested in exploring ways to organize and eliminate your debt, contact the attorneys at Fitzgerald & Campbell, APLC. We can review your current situation and discuss your options with you, whether that means bankruptcy or other options. Our attorneys have decades of experience representing clients in all types of consumer rights matters and we are here to help you!

Call us today for a free consultation at (844) 431-3851, or email us at

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