Most people don’t set out to go bankrupt, but a fresh start offered by the maneuver could be a wise and necessary move to recover from such setbacks as poor financial choices made when you were young, medical disasters or a divorce.

Super Frugalette identifies three indicators that may mean bankruptcy makes sense for you:

* Time won’t heal your financial wounds. If you’re not making enough to cover your expenses and your debt payments, you’ll only sink deeper and deeper as time passes.

* You’re considering sacrificing your retirement account. If you need the money to survive rather than as a quick fix, you may want to reconsider. Typically, 401(k) accounts are protected in a bankruptcy.

* You need to keep adding debt just to feed and clothe yourself. If you’re so cash-poor that you need to resort to nearly maxed-out credit cards for the basics, you’re wobbling on your last financial legs.

Bankruptcy isn’t a decision that should be taken lightly, and one that will have a lasting effect on your credit. But even the proud and determined shouldn’t ignore the relief that bankruptcy can offer.

Should you make peace with bankruptcy? Four points to consider… [Super Frugalette]

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