Best Reason To File Bankruptcy
If you're paying minimum payments on credit card debt and have nothing saved for retirement, you are my favorite candidate for bankruptcy.
The most compelling reason to file bankruptcy is so you can spend money on retirement savings. If you want to be self sufficient and live even a moderately comfortable life in retirement, it will take significant savings over time to make that happen. Take this retirement calculator out for a spin. For most people, attention to retirement can't happen while they are paying credit card debt at credit card interest rates.
Take a look at a comparison of paying off credit cards at minimum payments vs. saving that same money for retirement.
The older you are, the easier it is to think the task is too large,and the time remaining too small. However, it is certain that if you don't save for retirement, you won't have anything. Every bit you save is a cushion for the cost of living decades hence. I like the attitude of this old man:
The great French
Marshall Lyautey once asked his gardener to plant a tree. The gardener objected that the tree was slow growing and would not reach maturity for 100 years. The Marshall replied, 'In that case, there is no time to lose; plant it this afternoon!'
I often hear from clients who, I believe out of chagrin at the debt situation they find themselves in, resolve loudly that the debt is theirs and they intend to pay it.
I cannot fault the sentiment. My question concerns whether that is the best choice at this point in their lives. The credit card companies are ageless; they don't have to retire. Real people do.
Let me suggest that providing for your retirement is a manifestation of personal responsibility. If you don't provide for retirement, you stand to become a charge on family members or society at large. Having no choices in your old age is not a dignified retirement.
Adopt the approach of the winning slogan in a British contest to promote retirement savings: Pay now, play later.