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Knowing When to File for Bankruptcy

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Free Your Money: Strategies for Keeping Your Money In The Best Place Possible - ReadWrite


Life doesn’t always go according to plan. You may have needed to take on debt that outgrew your ability to pay it off each month. Now you’re wondering how to get your financial situation back in order.

Knowing when to file for bankruptcy is a valuable skill for individual consumers and small-business owners. Learn more about it and determine if it’s the best move for your financial needs.

What Is Bankruptcy?

Bankruptcy is a legal process begun by people who have too much debt. They must sign a federal petition that considers their outstanding financial obligations or debts before requesting that their creditors work with them to resolve their debt with any remaining assets.

What Are the Types of Bankruptcy?

People can accrue too much debt as individual consumers or business owners, so numerous types of bankruptcy exist to address those situations. These are the specific chapters outlined in the U.S. bankruptcy code that you may consider if you find yourself unable to repay debts.

Chapter 7: Individual Liquidation

Most people who need to claim straight bankruptcy over personal debt will file under Chapter 7. A federal court appoints a trustee to assist the individual with selling property to repay lenders or creditors. You can claim specific property exempt from Chapter 7 bankruptcy, like your car, pension, or household equity.

Chapter 11: Reorganization Bankruptcy

Small-business owners may be able to file Chapter 11 bankruptcy to reorganize their assets, affairs, and debts. If the collection of these factors exceeds $5 million, an examiner will step in to guide you through the process.

This can be a helpful step for business owners because it allows the company to remain open and operational while restructuring occurs. Creditors can also propose a Chapter 11 bankruptcy if the debtor doesn’t offer the idea first.

Chapter 13: Asset Maintenance and Repayment Plan

Individuals who file for Chapter 13 bankruptcy can keep their assets but must repay their debts within three to five years of a court approving their plan. You won’t have to liquidate anything if you don’t miss or skip any payments. Most people who don’t receive approval for this bankruptcy are workers without reliable sources of income.

When to File for Bankruptcy as an Individual

Before filing for bankruptcy, it’s essential to negotiate with your debtors or creditors. They’ll still get their money back if there’s a way for you to make long-term payments and eventually pay off your debt more efficiently.

Sometimes debtors will negotiate for that reason. However, they may not if they don’t see a viable path forward due to your financial history or situation.

When negotiating isn’t possible, and you’re about to lose your house or other essential assets because you can’t make monthly payments, it may be time to file for bankruptcy. First, schedule a credit counseling session to get the correct certificate for your requested type of bankruptcy.

A counselor will review your assets and liabilities during that session and find the best solution for your needs, even if that isn’t bankruptcy. You can find these experts by reaching out to federal credit counseling agencies.

You might feel worried that your property or existing net worth won’t be enough to pay off your debts. If that’s the case, your senior-most credit facility will establish a financial solvency plan to remedy the remaining debt owed alongside your credit counselor. By working out any necessary amendments, your minority lenders will follow the senior-most decisions if they create the plan in good faith.

When to File for Bankruptcy as a Business

When debtors don’t negotiate with small-business owners regarding their loans, it could be time to file for bankruptcy. Typically this would mean a Chapter 11 case, which has a few pros and cons for people operating small companies.

You may benefit from this type of bankruptcy if your creditors or debtors don’t meet to discuss new contract terms. Instead, the federal case would bring everyone to the same table to discuss options like extended payment terms for real estate, equipment, or manufacturing loans.

Small-business owners also don’t have to immediately liquidate their companies or assets to pay off the debt. Instead, they can remain open and operational because Chapter 11 prioritizes repayment plans approved by federal courts. A trustee becomes the facilitator monitoring the ongoing payments after both parties reach agreed-upon terms.

Small-business owners hesitate to file bankruptcy because it can become an expensive, drawn-out process. Depending on the court’s calendar and how easily debtors agree to payment plans, you may pay an average of $19,738 just for filing and attorney fees.

Additionally, you would have to make initial payments within the first few months of your plan agreement. That can be challenging after paying legal fees while continuing your daily business operations.

How to File for Bankruptcy

Many steps are involved with filing for bankruptcy. First, familiarize yourself with the process before making any final decisions.

1. Review Your Options

Remember, bankruptcy might not be necessary for your situation. Discharging debts like student loans and unpaid taxes will provide relief while you look into consolidation or settlement. You’ll need your financial history and credit report paperwork to make the best decision.

2. Choose the Bankruptcy Type

If you decide that bankruptcy is right for you or your business, you’ll need to choose from Chapters 7, 11, or 13. Individual or business bankruptcy is the first way to narrow down your options. Afterward, you can decide based on your assets’ value, outstanding debt, and ongoing income.

3. Decide on Finding an Attorney

The American Bar Association and state associations have lists of attorneys ready to assist people with filing for bankruptcy. Legal aid clinics and free services can also help if you can’t afford legal assistance but desire representation.

The option to represent yourself is also called going pro se. You won’t have to pay attorney fees, so you’ll save most of your filing costs. However, you may not receive the debt relief you need. A recent study found less than half of pro se cases resulted in debt discharge, while 93.9% of represented instances did.

4. Pass a Credit Counseling Course

Everyone filing for bankruptcy of any type will have to attend a credit counseling course. It helps people weigh their options to determine the best action, whether that’s bankruptcy or other types of debt relief. If you finish your class more than 180 days before filing, you’ll have to retake it closer to your official filing date.

5. Complete Your Counseling and Legal Forms

After meeting with credit counselors and completing your course, you’ll have to fill out all related forms. There are many involved with any bankruptcy, so prepare for this step to take some time. The forms include your financial history, statements, fees, and other related information. Your lawyer can help if you choose to get representation.

6. Pay Fees and File Forms

Your paperwork also comes with many fees. There are charges for filing, administrative work, and even surcharges if a trustee will oversee the payment plan arrangements with your debtors. Sometimes people can get these fees waived, but only if their income is 150% below the poverty line determined by a federal court.

7. Negotiate With Your Creditors

Whether you appear in court or not, your creditors will sit down with you after you pay your fees and file all necessary paperwork. They will review your situation and determine how best to repay your debts. Any agreements made at this point will be legally binding, as the meeting happens under oath.

8. Attend Debtor Education Classes

You must complete post-filing education classes if your lenders discharge your debts. This guarantees you’ve learned how to manage your finances better based on your academic performance in the lessons and tests. You’ll need to pay the class fee and earn the final certificate to complete your bankruptcy.

What Life Looks Like After Filing

What will your life look like after completing bankruptcy? It depends on how you file and your situation.

Chapter 7 bankruptcies remain on credit records for a decade after both parties resolve the outstanding debt. On the other hand, a Chapter 13 bankruptcy will only stay for seven years.

You’ll also reduce your credit score no matter how you decide to file. That could make it more difficult or impossible to get money from insurance companies and investors if you need to expand your business or recover from an emergency.

If you face significant debt immediately after experiencing bankruptcy, you may have to shoulder it alone for many years. There are limits to how often people can file specific bankruptcy chapters.

Debts That Don’t Count Toward Bankruptcy

You may not need to file bankruptcy if you owe money for reasons that don’t qualify. Here are a few types of debts that federal courts don’t count in bankruptcy filings:

  • Outstanding utility bills
  • Personal loans
  • Credit card debt
  • Medical bills
  • Payday loans
  • Past-due rent bills

Reaching out to legal representation or credit counselors will help determine if your debt qualifies for bankruptcy or if you need alternative solutions.

Know When to File for Bankruptcy

Knowing when to file for bankruptcy is essential to managing your finances. It could make things brighter or not be part of your future. Talk with an expert to see if it’s the best way to manage your debts while maintaining your personal or professional life.

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6 Ways to Prepare Your Business for the Upcoming Holidays

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Calendar


The holiday season can be incredibly disruptive, especially for small businesses and their customers. You could either be in a very slow season looking for things to accomplish or so overwhelmed by business that you feel like you got run over by a reindeer. If you haven’t started making preparations yet, you need to start today.

Simple adjustments can help you gain more business or handle a heavy influx of holiday patrons. Here are several ideas you can consider implementing to end the year on a high note:

1. Decorate With Holiday Spirit

Any customer that enters your business will feel the holiday spirit if you’ve got the right decorations in place. You don’t have to go overboard with inflatable pumpkins or flashing Christmas tree lights, but some well-placed decorative touches can really bring the place together. Plus, this makes the workspace festive for your employees as well.

You can choose to highlight the general themes of the seasons or focus on specific holidays. For example, autumn leaves and fall colors can get you well into November. You could also mix things up by putting up ghosts and jack-o’-lanterns for Halloween and switching them out for turkeys and pilgrims for Thanksgiving.

The same can be done for winter. Snowflakes and snowmen will work for the entire season. If you want to get specific, you have Hanukkah, Christmas, and New Year’s decorations to consider.

2. Work Out Employee Vacation Times

Everyone wants to take time off during the holidays, and for good reason. This is one of the best times of year to gather with family and enjoy life together. Unfortunately, some businesses can’t afford to have all of their employees taking time off simultaneously. Your job is to make sure everyone is getting fair time off while still staffing important dates around the holiday season.

How you approach this task is up to you and how you think your team will respond best. You might think it’s fair to let the most tenured employees select their days off first. You could also develop a rotation so that the same people don’t hog the same days off every year. Even a first-come, first-served approach could be considered if you think your team will be OK with it.

Remember that you deserve to take some time off as well. Being an entrepreneur is incredibly demanding and time-consuming. Taking even a couple of days off to enjoy the holidays with family can help you recover mentally and physically.

3. Encourage Calendar Collaboration Among Team Members

To ensure everyone on your team is on the same page with project deadlines, essential meetings and events, and client needs, it’s essential to collaborate on a team calendar. Most calendar software today offers team calendars.

Make sure everyone on your team has access to one another’s calendar so they are aware of when they are available. Then, team members can collaborate to help each other take on things that could otherwise be missed.

Thankfully, there are many collaborative calendar integrations available for teams to utilize in order to maximize their time. By utilizing these tools, teams can work more efficiently together. Therefore, they can minimize the chances of missing deadlines, missing meetings, or making clients unhappy.

4. Make Holiday Business Hours Known

Your customers also deserve to know how your business will operate throughout the upcoming holidays. You should communicate in advance the days you plan on being closed. This way, customers and clients won’t be disappointed when they try to visit, and nobody is there to receive them.

This is extremely important for schedule-based businesses. The sooner you block off certain days, the less likely you will have to reschedule a meeting or appointment that was booked in advance. Clients who have their end-of-year scheduled meetings rearranged or moved at the last minute will not be happy.

Consider sending out an email that details your holiday hours to any customers who have provided contact information to you. Additionally, you could also consider adding a note on your email signature that states when your business will be closed. You could implement this early on, especially for the winter holidays. At the very least, put up a notice on your front door and website that makes the revised schedule known and accessible.

5. Plan Marketing and Promotions

The holiday season is for family and friends, of course, but it’s also a commercial opportunity for businesses. (There’s a reason they call the day after Thanksgiving “Black Friday.”) While you shouldn’t lose sight of what’s most important, your business should be thinking about some promotions to run. The right marketing campaign at the right time can dramatically boost your revenue.

Marketing plans practically write themselves this time of year. Black Friday and Christmas sales are common and desirable. A salon could run cut-price haircut specials on Black Friday for those who want to escape the shopping fray. A mani-pedi promotion could capture the attention of those primping for holiday parties. Put your business’s personal twist on the season, and you’re likely to see sales increase.

What’s most important to prepare for is the increase in business during a holiday promotion. Make sure you are appropriately staffed for busy days with numerous consumers cashing in on holiday deals. If you’re not prepared to handle the business you’ve attracted, you’ll have a blue Christmas.

6. Consider Getting Extra Help

If you’re feeling overwhelmed by all of the business coming your way over the holidays, consider contracting some extra help. Plenty of businesses hire seasonal workers to lend them a hand for a couple of months. Your business doesn’t have to be an exception.

The great thing about seasonal workers is that there’s no long-term commitment. You can get an extra receptionist, hair stylist, or stockroom organizer for just as long as you need. These workers are looking for some extra holiday cash and simply want the additional hours before life returns to normal.

You may even consider contracting some digital help. A webmaster can help you keep your website up and running even with double the online traffic. Your clever marketing strategy could be implemented by a third party so you can focus more fully on your customers.

Closing Thoughts

Of all the above steps, the most important common denominator is to be sure your clients and customers are aware of when your business will be out, so they can plan ahead as well. This will help your business avoid the inconvenience and disappointment the unavailability may cause. Be sure to encourage in-house collaboration on important dates, in addition to collaborating externally with your clients and customers.

Keep your business on the nice list by being prepared for every upcoming holiday, whether it’s the longer holiday breaks in the winter or the shorter holidays throughout the year. With the above holiday preparation planning tips, your business can plan well ahead for this holiday season so nothing slips through the cracks.

Though it’s an extremely busy time for everyone, the holiday season doesn’t have to get stressful. There are so many ways to avoid all of the stress by planning well. The better you work together to prepare, the jollier the holiday season can be for your business and your customers as we head into the 2023 new year.

You might not feel entirely ready for 2023 just yet, and that’s fine. But by taking steps to prepare for the new year now, you’ll position your business to succeed beyond your expectations.

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Featured Image Credit: Photo by Quang Nguyen Vinh; Pexels; Thank you!

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Face Supply Chain Disruptions : Work Smarter, Not Harder

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How To Start a Business While Living With Your Parents


Supply chain disruptions are nothing new. However, since the beginning of the COVID-19 pandemic, supply chain disruptions have become more common. At first, these issues caused major shortages throughout the country. Now, shortages are still occurring along with inefficient shipping processes.

These issues have forced business owners to struggle with ways to stay afloat. Delays, interruptions, and cancellations have made it nearly impossible to keep up with demand while avoiding wasteful spending.

However, some things simply aren’t within your grasp when it comes to supply chain disruptions. On the other hand, you can work smarter to address them. You’re responsible for how your business responds to these disruptions, and with better approaches, things will run more smoothly.

With that in mind, let’s look at how your business can deal with supply chain disruptions. You can create a sense of hope in this digital world as things slowly start to return to normal and the supply chain issues start to balance out.

Use Data Analytics to Survive Supply Chain Disruptions

Collecting clean data and putting it to use can improve everything from customer service to your marketing endeavors. It can also be used to mitigate the effects of a supply chain crisis. Developing innovative data solutions can keep your business afloat and even help it grow during uncertain conditions.

Different Data Methods for Supply Chain Disruptions

To start using data to your advantage during supply chain disruptions, consider these methods:

  • Take a look at demand trends. You can look at customer orders and purchasing trends over the last year. This will give you a better idea of how much to order and how often to counteract supply chain disruptions.
  • Organize your data. This also makes it easy to look at your current inventory and open order allocations. You can compare your inventory and orders with data provided by production teams or vendors to create a realistic timeline of when things will arrive or when they can be shipped out to customers.
  • Pay attention to demand volatility. People aren’t necessarily hoarding items as they did at the beginning of the pandemic. However, there are still some things consumers are regularly purchasing to prepare themselves for the future. As you look at data relating to the current supply of popular products, as well as data from the manufacturers, it will be easier to keep a steady flow of those products in stock.

While looking at data might not sound like an immediate plan of action during turbulent times, it’s easier to make positive changes and work smarter in the face of supply chain disruptions when you have the right information.

Build Your Brand to Withstand Supply Chain Disruptions

It’s difficult to focus on anything but the supply chain issues affecting so many businesses right now. However, retting over those issues isn’t going to get you anywhere. By shifting your focus and putting your energy into supply chain disruptions, your business can move forward.

Building a brand isn’t easy, which is why it requires a lot of time, attention, and focus. Taking this time to hone in on your marketing is a great way to make your business more of a household name. That kind of brand recognition is exactly what companies need right now to stay afloat when supply chain disruptions occur. You can build your brand awareness and identity (stickeryou dot com), in a variety of ways, including:

  • Defining your company values
  • Understanding your audience
  • Determining what sets your business apart
  • Creating brand guidelines

Once you have a strategy in place to grow your brand, utilize things like logo creation, social media, and special events to grow your name and help your customers understand who you are.

Build Consumer Relationships Despite Supply Chain Disruptions

Even if you’re facing supply chain issues, you can build relationships and establish trust with consumers. Today’s consumers desire relationships with businesses more than ever before, so it’s okay to show the “human” side of your brand as often as possible. That can make it easier to provide positive customer service experiences when you’re facing product shortages and delays.

Communication with your customers is one of the best ways to deal with frustrations over delays and supply chain issues, so be transparent. Make it a part of your identity. When you make sure your audience knows about the issues you’re facing and keep them updated about shipping information (including delays), they’re more likely to be understanding and patient.

Prepare to Handle Disruptions to Your Supply Chain

Supply chain disruptions are all but inevitable. Make sure your business has a backup plan and is prepared to deal with them when they arise.

If you don’t have one already, consider establishing an emergency management center within your business. Once you have a team in place, you can offer them previously collected supply chain data and create a plan of action. This will make it easier for them to create an effective strategy while reducing the risk of miscommunication that’s often associated with supply chain disruptions.

You should also create a backup plan that incorporates the existing suppliers that can adapt with you when disruptions happen. It should also include technology exploration. Tech, such as AI, can make a big difference in the future of your business – even if it forces you to change some of your existing supply chain processes.

Be Patient During Supply Chain Disruptions

Additionally, try to be patient when disruptions occur. This isn’t the first time the world has seen supply chain issues, but they’re more unsettling now since there’s no end in sight. As someone involved in business, take heart in knowing these delays and disruptions won’t last forever.

In the meantime, focus on working smarter, not harder — to navigate supply chain disruptions. By mitigating some of the issues, being smart with data collection, and focusing on boosting the strength of other areas of your business, you’ll be able to get through these disruptions more comfortably. You may even come out on the other side with more resiliency and knowledge.

Featured Image Credit: Provided by the Author; Mika Baumeister; Unsplash; Thank you!

Amanda Winstead

Amanda Winstead is a writer from the Portland area with a background in communications and a passion for telling stories. Along with writing she enjoys traveling, reading, working out, and going to concerts. If you want to follow her writing journey, or even just say hi you can find her on Twitter.

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Holiday Gift List Ideas; Keep ’em Coming

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InfinityX1


Here are a few Holiday Gift List Ideas. It is always fantastic to hear from people who are excited about their gift-giving lists and who have some unique ideas to share. I have a few of these items — but I’d love to hear what other gifts you have loved, either for yourself or items you have gifted. This list has something for mom, dad, brother, sister, neighbor, and the kiddos. Enjoy!

  1. Infinity X1

InfinityX1

The Infinity X1 products include flashlights, headlamps, lanterns, auto lights, work lights, and many other items that you will want to add to your lighting needs. This is sustainable power management. These flashlights are very bright, and they last a long time. You will want to keep one in your car, home, and toolbag.

 

2. Miko AI

 

 

 

 

Miko AI
Miko AI

The Miko.ai is the perfect blend of logic and magic. It can see, hear, and remember, and it senses a child’s moods. I got this for the kiddos for the holidays. I will report what I learn. Miko AI keeps giving you new content and capabilities each month with ever-evolving experiences.

 

3. Pit Command

Pit Command
Pit Command

The Pit Command tool is built for medium fires. It is made of carbon steel construction, so it is strong and lightweight at the same time. This is really a three-in-one tool. It has an axe-like chopper and a serrated hook, but the most fun is the poker that everyone loves. Guaranteed quality, free shipping, and free returns.

 

4. Get The Fort

Get The Fort
Get The Fort

We have the Get The Fort at home. The quality is incredible, and everyone loves it. You can use these fort blocks in adult exercises while the kids are playing with them too. We have the gray — but I’m getting the turquoise next.

 

5.  NOCO Boost Pro

NOCO Boost Pro
NOCO Boost Pro

NOCO Boost Pro feels like I’ve purchased the most safety that one person can give another. Leave this wonderful power bank in your car so that you can start your own car or help out someone in distress. It has up to 40 jump start on a single charge. Rugged and water resistant. GB150 3000 Amp 12-Volt UltraSafe Lithium Jump Starter Box, Car Battery Booster Pack, Portable Power Bank Charger, and Jumper Cables for up to 9-Liter Gasoline and 7-Liter Diesel Engines

 

6. Narwal Robot Mop

Narwal Robot Mop System
Narwal Robot Mop System

The Narwal Robot Mop System intelligently detects how dirty the mops are and sanitizes them in a high-speed spinning using the exact amount of water needed. It also senses how dirty your room is and sends the unit around again if needed.

 

7. SureCall Boost Cell Signal

 

 

SureCall Boost Cell Signal
SureCall Boost Cell Signal

There is nothing like the SureCall Boost Cell Signal System. If you have ever experienced delays in your cell service — especially in the mountains or out on the beach area — you will want this system. There is nothing like reliable service, especially if you work from home and your teammates depend on your work being turned in on time. When you have others depend on communication from you — you’ll want SureCall Boost Cell Signal.

8. AquaSonic

 

AquaSonic
AquaSonic

The AquaSonic is backed by the American Dental Association seal of approval. This means that you are using the gold standard for oral care. This electric, ultrasonic toothbrush is fun to use. My dentist told me to get this toothbrush and leave it in the shower and use it there. It even comes in black for a nice modern touch.

 

9. Iottie 4 in one device

If you have a Tesla 3 or Model Y vehicle — you have going to want this electric charger. You can charge up to four devices at the same time. It has seamless installation and doesn’t take up storage space. This charger has a classy design as you would expect. Here are the specs:

2 USB-A ports for charging devices
2 USB-C ports for fast charging & data transfer where available
Wide device compatibility
Minimalist design
Made exclusively for Tesla Models 3 & Y manufactured in 2021 and later

10. BC Wireless Lite

BC Wireless Lite
BC Wireless Lite

Unlike traditional headphones, BC Wireless lite uses bone conduction technology to transmit sound via the cheekbones. This technology leaves ears open to the surrounding sounds. Audio is set to an appropriate volume, ensuring safe levels of listening to the child.

11. myFirst Camera Insta Wi

myFirst Camera Insta Wi
myFirst Camera Insta Wi

myFirst Camera Insta Wi is a dual-lens digital camera with a front and rear selfie lens that is capable of inkless thermal instant printing in 10 seconds. Also able to transfer photos wirelessly and has a dedicated mobile application for label editing/creation, and lastly, the cradle is provided to rest your little cute device.

 

12. BuddyPhones Play

BuddyPhones Play
BuddyPhones Play

BuddyPhones Play+, Wireless Bluetooth Volume-Limiting Kids Headphones, 20-Hours Battery Life, 3 Volume Settings, Voice Enhancing StudyMode, Answer/Playback Button, BuddyLink Cable, Cool Blue. Kids will love the easy-to-use, on-ear headphones while being driven from home to school and on family trips. Hop on Amazon and see additional items like these for your kids. For girls and boys ages 2 to 10 years old to enjoy flexible connectivity

 

Featured Image Credit: Photo by Nicole Michalou; Pexels; Thank you!

All Inner Image Credits: Taken from the Product WebSites; Thank you!

Deanna Ritchie

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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