Behind on Bills? Becoming a Social Recluse Can Lead to More Trouble

You Must Keep Some Semblance of a Social Life Even With Money Problems.

Being behind on bills really sucks – the threatening dunning letters, harassing phone calls, etc. What can suck most are the social ramifications. When your finances are a mess you can find yourself slowly withdrawing from society – you may not even notice. Social withdrawal can quickly lead to mild depression (if not worse) which is definitely not conducive to helping you take control of your finances by attacking the problem head on.

Humans are social beings. We need to interact with others to maintain our mental stability. For the majority of us, the most important social interactions are with friends and family. And having no money can lead to less interaction with both groups.

How a social withdrawal may start.

You stop participating in the events with your extended family. After all, going to your cousin’s birthday party costs money; you can’t just show up empty-handed, right? Your credit cards are maxed out and you have no cash for a gift (not even a small one) because you’re trying to keep up with the minimum payments – that have now doubled since you’ve fallen a bit behind. So you come up with an excuse and you don’t attend.

You spend less quality time with your immediate family. Constantly preoccupied with your finances, you can’t enjoy any activities because your concentration is elsewhere. Doing stuff outside the house is out of the question; even taking the kid to the zoo costs money. There’s the price of tickets, and heck, you have to pay for gas to get there.

The severe debt induces the social withdrawal further as you stop going out with friends. You can no longer afford to go to a movie or to hang out over a few beers. You have to pay for the beer and there’s that dreaded tip (Remember when you took great pride in being a great tipper?).

Serious consequences to the unwary.

A missed birthday party, a pass on a hangout, etc... The next thing you know you’re screening calls from family and friends as if they themselves were the debt collectors. You figure: what’s the point? you can’t afford to participate anyway! Now you’re even in a deeper hole. Not only are you in trouble financially, you’re now in trouble mentally and emotionally. It becomes hard to take any kind of action when you’re mentally resigned. You must be proactive to take control of your finances. You have to want to get out of bed in the morning.

You don't have to be a social butterfly. A small amount of social engagement can go a long way.

So the bottom line is this: You don’t have to attend birthday parties or hangouts with friends when your finances have taken a turn for the worse. Just be mindful of the dangers of a complete social withdrawal. Lack of interaction with your social support networks can lead to depression. And depression is a bad thing. You must attack your financial situation with all your mental faculties intact.

I challenge you. You challenge you.

I challenge you and you must challenge yourself to get informed about all your debt relief options; after all, knowledge is power. Address your financial problems head on

. . . and start living your life in color.

- BKguy
“Get out of debt . . . and start living your life in color.”

Understanding America's Bankruptcy Law and Getting it Right.

Intro

This “Understanding” series of posts is aimed to help you get a grasp of the general principles and policies behind our bankruptcy law. I won’t be getting into the technical provisions of the Bankruptcy Code or what relief the Code can provide for your situation. Instead, I’ll give you a brief overview of how the law came about, its purpose, and how it works. My hope is that once you better understand the principles and policies behind the Bankruptcy Code, you will have an easier time embracing bankruptcy as a debt relief solution.

The History of Our Bankruptcy Law

To start the series, I will briefly discuss the history of America’s bankruptcy law in these next couple of posts. I know, I know . . . who cares about the history of bankruptcy law when you just want fast relief from burdensome debt. Well, believe it or not, there are a lot of people that are in need of bankruptcy protection but are afraid to seek relief due to the sheer terror of even the idea of bankruptcy.

My stance on this inhibition is that most people that are afraid to consider bankruptcy as a solution don’t have the complete picture of bankruptcy law. They just embrace the negative misconceptions about the law that gives the term “bankruptcy” its stigma while the important policies driving the Bankruptcy Code get “lost in the sauce.”

There’s a lot of misinformation out there about bankruptcy. You can easily get wrong information from the internet, from your neighbor, or even your mother. That’s why one of my main objectives through this blog is to provide you with concrete information about America’s bankruptcy law so when you decide to either embrace it or reject it as a debt relief solution, you can do so intelligently. I mean, you can lead the horse to water, but you can’t make it drink, right?

Through my experience I have found that knowing the history of something and the underlying policies behind it are important setting stones to understanding it – whatever it may be. After you understand it you can then either embrace it or reject it. This also applies to bankruptcy law.

First Historical Lesson | Founding Fathers did not make bankruptcy a constitutional right.

Contrary to popular belief and many internet search results, bankruptcy is not a constitutional or fundamental right. Take a look at the United States Supreme Court decision U.S. v. Krass, 409 US 434. The Court explains that the bankruptcy discharge is a legislative “benefit” created by our Congress. So while it’s your statutory right, it’s not your constitutional right.

You might think: “Who cares!..does it really matter whether bankruptcy law is a constitutional right or a legislatively created one?” Well, yes and no.

No, it doesn’t matter if you’re seeking to get relief from debts right now, because the Bankruptcy Code is here and you can take advantage of the law RIGHT NOW.

But on the other hand, YES, it does matter. It matters because what Congress “giveth,” Congress can “taketh.” In fact, except for three short periods during the first 110 years of America’s life the benefit of the bankruptcy discharge wasn't available. A bit more recently in 2005, due to the powerful lobby of the credit card industry, Congress decided to make bankruptcy relief more complicated and difficult to obtain (thus more expensive). Congress is also the reason why over a trillion dollars in student loans is largely not dischargeable in bankruptcy. The bottom line is that it’s well within the power of your Congressmen and Senators to control your financial destiny if you are ever in severe debt for whatever reason. And this means that it's also within the credit card industry's or medical industry's power because these imposing special interests can surely influence your legislators.

The side note to that, of course, is that YOU can influence the decisions of your legislators. And your participation is more important than ever largely due to the Supreme Court’s Citizens United decision where the Court held that corporations (this includes credit card companies, for-profit schools, etc.) can spend unlimited money influencing our elections.

So, while Article I, Section 8, Clause 4 of the U.S. Constitution does provide for bankruptcy laws throughout the United States, it merely gives Congress the power to create them. It certainly does not create or guarantee them.

Instead of getting into the reasons for the prevalence of this “bankruptcy is your fundamental right” misinformation, I’d like to ask you to chime in with yours. However, this definitely may be a topic for a future post.

A Quick Summary

There is a lot of misinformation out there, and you should reserve judgment about considering bankruptcy as a solution to your debt problems until you at least understand the underlying purpose of our bankruptcy law. The best way to do this is to start with getting to know the law’s history. One of the biggest misconceptions out there about bankruptcy is that it’s your constitutional right – it isn’t. The Founding Fathers merely gave Congress the power to create bankruptcy laws but never guaranteed them. Congress used the power to give you the right to file bankruptcy because letting people file bankruptcy is grounded in sound principles and policy reasons. The most important thing to remember out of this historical lesson is that Congress is well within its power to take away your right to file bankruptcy.

Next Post

In the next post, I’ll discuss the reasons the Founding Fathers wanted Congress to have the power to create bankruptcy laws.

- BKguy
“Get out of debt . . . and start living your life in color.”