Given the current financial climate many of us are trying to be more prudent with our money. The cost of living has increased and unemployment is on the rise.



In the UK our MPs talk about morality and finances. You may remember when the MPs were talking about cracking down on single mums that weren't working. They spoke of an injustice to the tax payer.

Well isn't it funny that in this year, 2009 ? we have heard and discovered many of the immoral behaviours and attitudes of these same MPs. Exploiting loopholes to fund second homes, and recently the expenses report that was leaked. Now you have to ask yourself ? why is it an injustice when we take advantage of the system's loopholes, but ok for MPs to do it?

Now I'm not saying we should all take advantage of the system, but I'm asking for a little consistency here. The tax payer is bailing out the corporations for a recession that was predicted well before it was reported, and in the midst of this we find that the law-makers of this country have certainly not been helping the situation.

What we need is more transparency and honesty.

I am an Insolvency Advisor and I spend my working week helping people file for bankruptcy. One of the main points my clients bring up is the guilt they feel when considering bankruptcy because of a perceived ?stigma? attached to it. A stigma that is encouraged by our Government, even though bankruptcy is a civil right we all have.

Your Government don't want you filing for bankruptcy, especially if you don't have any assets of value, as they lose out, and your Government ? as an institution - is more concerned with people in Government, than anyone outside of it. In addition, your creditors don't want you filing for bankruptcy for the same reason.

Now this is understandable ? you did after all borrow the money. The other viewpoint is that you fell into the creditors? debt trap. They're not stupid ? they know how much you've borrowed and they can assess if offering you more finance is a wise decision and yet the offers will keep coming and the marketing makes light of such borrowing in order to entice the consumer. The same ethics as a drug dealer are employed, and you can see why, because they work!

So do you feel a moral obligation to repay your creditors? Is it nobler for you to practically live in poverty in order to sustain your debt repayments? It takes two to tango and you certainly should not rest all the responsibility on your shoulders for the negative financial situation you may find yourself in.

Filing for bankruptcy gives you a fresh start without the burden of debt and you will have learned a valuable life lesson concerning finance.

For first-time bankrupts in the UK you are automatically discharged after 12 months. During those 12 months you are restricted from certain occupations such as an accountant, lawyer, insolvency practitioner or even a member of parliament. You cannot act as a company director during this time either. Once discharged all restrictions are lifted.

If you have an expensive car over ?2,500 or own a home with equity in it then it may be seized. Bankruptcy is a much simpler process if you don't have any assets to protect (car under ?2,500, rented accommodation).

If considering bankruptcy seek professional advice.