Once a California resident has made the difficult decision to file for bankruptcy, the next step often involves researching how that decision will impact their current financial standing. Often, fear and uncertainty surround the decision to file, and can even lead some to postpone filing long after it becomes clear that personal bankruptcy is the best course of action. In reality, however, many of the beliefs that people hold are simply untrue.
One such belief is that an individual who files for personal bankruptcy will lose all of his or her assets during that process. In reality, however, there are many types of assets that are protected during bankruptcy. Examples include certain college savings accounts, as well as retirement savings. Government benefits such as social security payments will also not be affected by filing for bankruptcy.
Another common fear is that an individual who files for bankruptcy will have difficulty obtaining a new job. In reality, it is against the law for employers to discriminate against a prospective employee on the basis of their having sought bankruptcy protection. In addition, most employers are sensitive to the financial devastation that people all across America have experienced in the recent recession, and will not allow financial strife to influence the hiring process.
At the end of the day, there are certain financial circumstances that require an aggressive response. Insurmountable levels of debt can best be addressed by filing for personal bankruptcy. Once California consumers become aware of the truths and fictions that surround this financial tool, the choice to file is often made far easier.
Source: westfaironline.com, "Column: Bankruptcy a viable option for some", Stephen P. Wright, May 27, 2014