Not so much a question, more a vent and need to get it off my chest.
We have been forced into bankruptcy. We have exhausted all other options. I feel like a total and complete failure. I feel like we have completely failed our children and messed up our whole future. I am so ashamed, and hoping nobody, especially our family, finds out. I am scared. I feel alone. I am angry at ourselves for getting into this position. I don't know what to do. I haven't slept in days, I am an emotional wreck and to make matters worse I am pregnant and feel so stupid for bringing another baby into this mess that is our life at the moment. There just doesn't seem to be a light at the end of this tunnel. Our kids deserve so much better. They deserve to be able to go places, or do things like dancing or sport etc. Not having to ask if they can do something like go to a friends birthday party then stop half way through and say "oh, we probably don't have enough money do we mum". We try not to involve them in these issues- its not something they need to know or even worry about but of course they pick up on stuff. I want them to have a normal life, a happy life. And we can't even do that. Yes they are loved and have their needs met and they will always come first. But I want them to enjoy being kids- doing things they love, going to birthday parties and just enjoying life. Instead they are dragged down by our hopelessness. And that kills me.
Please do not judge us. We are doing that enough ourselves and I guarantee you that its 100 times more harshly than you could ever do.
20 Replies
I'll reply as both the parent in this situation, and as a child who went through this situation.
My husband was in an abusive relationship before we met. She would force him to take out loans, and tell him he'd never see his child again if he didn't.
His mother also made him take out loans to buy her things, too.
And they'd both take his money frm his wallet (literally) and refused to let him pay the loans back.
Add this massive debt and 30k+ in legal fees in regards to custody, and bankruptcy became our only option.
We live paycheck to paycheck most weeks, but we've learnt very quickly that its not about the money, but the memories we make playing in our backyard, or having a picnic in our loungeroom.
It's the simple things.
And as a child -
There was a year I remember where each week, we would be counting 5 cent coins and praying we had enough for a loaf of bread.
Where I had to stop my dancing classes, and miss out on school excursions.
And where I learnt just how hard my mum was working to make ends meet.
And I appreciate her even more, now that I know just how hard it is.
You are doing what is best for your family, so great work! Well done! Be proud of yourself for how hard you're working!
Bankruptcy is not an easy decision! But you still made it, because it was best for your family.
And your children will grow up to appreciate it.
After all, the best thing you can spend on your children is time. :)
Thank you for that. I'm just so lost. I am so scared we will lose what little we do have.
Didn't you receive a list of information on what they can and can't take when you filed for bankruptcy?
Don't quote me, because I have a horrible memory, but I believe they can only take
- Car valued over $7000
- Any UNESSENTIAL items over a certain value.
- Any 'tools of trade' over a certain value (cannot recall how much)
- Any expensive jewellery (NOT including wedding/engagement rings)
- Super annuation, over a certain amount.
- Tax return, over a certain amount (or, maybe even the lot, my husband was unsure when he told me)
- Wills in the bankrupt persons name (so, if someone leaves them a big sum of cash or a house). I'm unsure about life insurance, but it may be included.
- 50 cents for every dollar OVER a certain income (I think it's 50k, but I'm not sure)
You also cannot go overseas whilst you're considered bankrupt.
This is for 3 years.
You're considered ex bankrupt after this point.
But your name is 'cleared' after 7 years (however, you're still on the national database)
They will not take any personal items, such as clothing or furniture.
They will not take anything you need to get by.
They also won't take anything from the husband/wife, unless they're bankrupt as well.
We haven't done any paperwork yet. We have only reached this decision in the last 2 days and are just starting to get the ball rolling. Thank you for that list, it was helpful. Although I am even more scared now because I can't afford to lose my car as well!
Sell it and downgrade, if its an expensive car.
I have a 3k car that's amazing, and absolutely brilliant on petrol.
I'm looking at upgrading and found an amazing car for 5k.
You don't need anything too fancy. As long as it's reliable, and gets you from A - B
(And I just checked - its $7,600 is the most expensive car you can own)
https://www.afsa.gov.au/debtors/bankruptcy/consequences-of-bankruptcy
Its not an expensive car, we paid $7000 for it. But we need it due to the size and number of kids we have, plus another on the way. We don't fit in a smaller car (hence the reason we got this one). Market value is still over $10,000 for the type and model though :(
You can protest everything.
If it's considered a need, you may be able to keep it.
But check out the link. It has all the information you need, and a number to call if you have any questions.
And if you need anymore advice, comment here and I may be able to help.
:)
Good luck x
Thank you so much, you have no idea how much I appreciate it
you sound like your really going through it right now. I don't know much about bankruptcy but I do know what it's like to struggle at the moment I'm just starting to get back on my feet after my breakup with my sons father I understand how stressed you must be feeling it may feel like there's no end it will be rough but you will get there it will get better! As for the kids I am one of 5 kids we were extremely poor as kids I remember melting cheese and feeding that to my little brother for dinner as we had no other food we didn't go many places or have expensive things but I had a great childhood the happiest days of my life were spent at a park playing cricket or touch footy with my family not expensive outings. Please don't be so hard on yourself sometimes things happen you are doing the best you can ☺
your kids are learning fabulous skills for when they are adults. Kids who have everything and don't have to wait or think about money ever grow up believing thre adult lives will be easy and ill prepared for waiting, saving and missing out on some things.
Your kids are learning to be resilient and learning that to be happy you don't need things, and that living simply can bring happiness, if that's the lesson you choose to make this.
My grandparents went bankrupt in the days where they took everything and the man went to debtors jail! My mum has the best memories of that time. Life became about family and living simply, spending time, playing cards and board games, playing under the sprinkler rather etc.
What a great opportunity to get back to basics and get out of the rat race!
That's my big fear- they will take what little we do have. My car, furniture etc. Car is owned outright, so is most furniture except my computer (when I was studying), fridge and a chest of drawers we have through radio rentals. I don't want to lose everything!
yiu won't loose everything. They don't take personal belonging. Yes you might loose the radio rentals stuff. But I survived for a month with an esky while I saved for a second hand fridge and sometimes the salvos can help with that stuff.
Please don't panic. People who go bankrupt are very well protected these days.
By esky I mean laundry sink with ice in it! We didn't get sick I just bought fresh food as we needed it for a while rather than stock piling.
It's ok you'll get through it. The kids will be ok.
Can't you sell the car to your mum and do the paperwork to change owners. Then just borrow it when you need it.
Another way to look at this is this; you'll always be entitled to enough to get through week to week, living simply. I do and have done this for a few years, it's very doable as long as you downgrade everything and let go and living within your means.
Holding on and trying to salvage what you can and feeling like a loser for everything you downgrade may actually be holding you back and making it harder for you to embrace a basic life. It's a mental thing. Get back to basics, you'll survive. A lot of kids already live this way and always have. My kids would have no idea they're poor actually and they're very lovely and very happy.
Speaking from recent personal experience...
Don't panic.
You say you've just decided yourselves - have you seen a financial counselor (Salvo offer free)? Maybe there is another way...
Do you both have to declare?
Can you come to a payment arrangement with your creditors? They will listen as they get more this way - if you declare bankruptcy only the administrator and the bank make money. NO-ONE else gets paid.
Your car will not be taken from you. Its value is under the threshold
Your household furniture and clothes are left with you. Your rented items will be repossessed.
You do not lose your super
You can earn $50,000+ pa without it being taken from you (depends on how many dependents)
The emotional turmoil is the hardest thing - shame, anger, guilt, embarrassment, self pity, depression, you go through it all
Everyone you owe money to is going to know - the administrator writes to them all. If you live in a small town, everyone knows...
Don't take on their judgement - if you have done everything possible to pay your debts and this is your only remaining option then hold your head high.
Learn from the mistakes - learn to read financial statements, check every account, budget and stick to it. Pay cash whenever possible.
Support the creditors who supported you, with the little money you do have to spend.
You can't own anything for 3 years and it will take another 5 for anyone to give you credit.
Take it slow. Back to basics and as other posters said - give your kids your time. The younger they are the less they will notice. We had teenagers and we discussed it with them. One was particularly hurt as he lost his job too.
Don't be afraid of good debt once you are discharged.
This is one of the hardest times of your life, take a deep breath, you will make it through. I'm thinking of you :/
Thank you for the words of encouragement and advice
You are NOT a failure. Sometimes money issues are out of our control. Economically there are alot if people in the same position, so dont be so hard on yourself.
Kids dont care about fancy houses, cars etc. they want a happy mum and dad!!
Go to the park, beach - lots of free things to enjoy as a family. Let the kids go to bday parties, just buy some colouring books and pencils, you dont need to buy expensive gifts.
If that's too much of a stretch some weeks, dont tell kids you cant afford it, say you akready gave plans and do something together as a family. My kids love treasure hunts...so much fun and free.
We are all doing the best we can, you are doing a great job. Things will improve.
Don't stress yourself once it is all finalised you will actually feel freed from the worry of how you will get through each week, you learn how to save and how to budget. My husband and I went bankrupt 4 years ago and were able to keep our car they didn't touch our super and did not come to our home and take anything. We did surrender our second car that was on secured loan though as the cost and practicality of 2 cars just didn't add up (we were offered to continue paying the car and keep it but just didn't need the stress.) We are now coming out of the bankruptcy and have managed to get a car loan now and know how much we can afford without taking on the banks advice and making silly financial mistakes and exceeding our income