Going bankrupt

In American culture, the idea of anyone filing bankruptcy is seen as a personal failing. People wonder how could you? Why didn’t you try hard enough? Maybe you are just a deadbeat. Never mind the fact that the rich and powerful often file bankruptcy (hello…Donald Trump) even companies use the legal protections afforded under the bankruptcy chapters to restructure themselves and get back on the right track.

No, it’s the average Joe’s sorta like myself who tend to shun bankruptcy because well it makes you look bad, you feel like you are walking away from your responsibilities and a host of other reasons some valid and some steeped in emotions. So it may come as a surprise that I am about to get real open here but it looks like I will be going bankrupt, filing bankruptcy that is.

The truth is that for the last 2 years we have been playing a financial version of three card Monty, robbing Peter to pay Paul but not only are we not getting ahead, we are on a boat that had a slow leak but now that leak is not so slow anymore  in fact water is rushing in our financial boat and threatening to drown us.

I have spent the last two years reading all the financial experts, Suze, Dave, etc…reading financial blogs and truly getting a financial education. Problem is that no matter how I cut it, what we need to pay out, exceeds what comes in. For a while the Spousal Unit was talking about going back to school to change careers, maybe go into teaching and while that is still a strong possibility the fact is it would take a year of schooling and student teaching to make that switch. Then there is the hunt for a new job and sadly first year teachers in Maine still make less than what he earns right now as an editor/writer.

I think going back to school is a great long term strategy since we have no retirement, hell we don’t even have health insurance (it was one of the early casualties of trying to pay the creditors) but its not going to get Visa, Mastercard and the vast array of creditors off our backs. Before you ask we have tried working with them, in fact last week I had a conversation with a bill collector that was the last straw. The bill in question was for $3300, well I offered $25 a month as that is the best I can do since I have a lot of bills at the moment. Mister Bill Collector told me no, that was not acceptable and hung up on me. Yes, he hung up on me….so a sista called back and was told that I was not being serious about paying off my debt. Considering 6 months ago I could have only offered up $5 a month, I thought I was doing good.

Anyway after 2 years of struggling, we are finally at a place where we can pay all our bills and expenses required for daily living. We have learned to live off less, its been hard but we are doing it but the reality is we are not chipping away at our debt, there simply is no cash leftover to do that. Health insurance is still out of reach and apparently despite the government saying they care about insuring kids through the SCHIP program, sadly we don’t qualify for that either. Its only the third time in two years that I have applied and despite the colossal drop in income, I was told last week that our income is still decent.  Yep, just stuck in that gray area, too poor to move ahead and too rich to get any help.

I imagine you may be reading this and wondering how much debt do you have? Well excluding our house which is paid off thanks to the largess of family members, we are over $200,000 in the hole, now half of that is my student loans which sad to say will be with me forever (another reason I need to get rid of the debt that I can). The other part of debt is back taxes (early years of the Spousal Unit’s self-employment), medical bills that were not covered by the crap health insurance we used to have and credit card debt.

In the early years of life in Maine when the Spousal Unit was getting established as a freelancer, there would be lulls between pay and credit got used. I cannot say that we have ever used credit to furnish anything extravagant as evidenced by the fact most of the stuff in my house is second-hand including clothes. Our car is a piece of shit, a 12 year old rust bucket, I bought used off a friend when our other car died after years of mistreatment.

No, the lack of savings when we moved here and the husbter deciding to become freelance played a large role in the debt that we now have. In case you are wondering why he chose to become a freelancer, its because when we moved to Maine, there were no editorial jobs like the one he held in Chicago available in Maine. I knew it was a risk we took when getting him to agree to move to Maine which he was not happy about…that’s another story though. The move to Maine was not entirely voluntary on our parts since it involved my ex-spouse and son.

  I am glad I know how we got here so I can work on ways to never be here again. Which is why I am more convinced that despite my personal aversion to bankruptcy that its time to make that move, months ago I used to break into a cold sweat thinking about bankruptcy but now I am thinking relief.

I know there are some who may judge me and that’s fine, but part of why I wrote this and decided to share such a personal issue is because we are living in  a time where folks are killing themselves because of money. Folks lose a job and end their lives…well, here I sit getting ready to make this major leap and I am actually at peace with it.

And yes,  I know my credit score will be shit but the truth is its already shit, it will just be shit and now I can answer my home phone instead of keeping the ringer off….ok, I know I am being light about this but its better than crying.

In the end, I know I have tried the best I can to honor my commitments to my creditors but by the same token, when I see that my kid needs dental care and I am putting it off because I am trying to pay Visa and Discover Card who wrote me off a long time ago because what I offered was not enough. Instead sending me to collections where the collectors have even less mercy, then its time to change course. I am reminded of how on airplanes when they give you the safety spiel you are told to put your mask on first and then take care of others…this is one of those situations.

Perhaps years ago we should have chosen high paying professions, a discussion we have a lot but sometimes looking back does nothing but create tension, right now I can only move ahead.