Life after bankruptcy
If you are reading this blog because of worries about your own or a friend’s approaching bankruptcy, or of what life will be like after bankruptcy, welcome.
The key thing is to make sure that you have got really clear advise, that you speak to accountants and get clear legal advise.
The fear of bankruptcy, and the experience of a business failing or of debts accumulating can be overwhelming.
But, experience shows that actually going through the process of declaring yourself bankrupt can be a huge relief, and can lift the burden of debts and the pressure of debt collectors, and leave you free to start again. There is life after bankruptcy.
In my practice I develop conversations with people to:
- help them come to terms with what has happened
- to help them develop the steps to move on
- to work with them as they plan for life after bankruptcy
Problems people commonly face concerning life after bankruptcy
Before we get to the acceptance that this is happening people tend to go through a process and period of denial. It is during this stage that you are likely to ignore letters and emails and try to stick your head in the sand. This is unhelpful, though entirely normal.
Being caught up in the process of a once profitable business failing can be bewildering as you watch the business spiral out of control.
During this phase individuals will likely be plagued by demands from creditors and credit card companies to have money paid back. There are threats from bailiffs and so forth, all of which contributes to the feeling of unmanageability.
2 anticipation of bankruptcy
With the acceptance that bankruptcy is happening, there is often an unexpected sense of relief and things improve immeasurably. There is a lot of useful information available to help you understand and think through the process. Once we have accepted this we can then start to read the information on bankruptcy. I have included many useful links below. You may find the anonymous Guardian Blog Diary of a Debtor helpful.
3 process of being declared bankrupt
Being declared bankrupt is a process, it comes with predictable timelines. It lasts for 12 months before it is discharged and during that time there are certain restrictions.
Government advise on becoming bankrupt.
4 twelve month period of bankruptcy
While you are bankrupt, certain restrictions will be in place. It is helpful to be clear about what these are. The Citizens’ Advice Bureau list the following restrictions before the bankruptcy period has been discharged:
- Borrow more than £500 from a lender without telling them you’re bankrupt
- Be a company director
- Buy a council house using the ‘right to buy’ scheme
- Change the name of your business if you’re self-employed
Once you have been declared bankrupt you are in a position (once the 12 months has elapsed) to start again. The debts that are held against you are written off and creditors can no longer pursue you to claim money back; a big advantage.
In my work I tend to try to help people who are approaching bankruptcy or who have gone through bankruptcy to help them work out what they’re going to do next, and to come to terms with the situation and the decision.
Then after the decision has been made and the judiciary has rolled on the decision of bankruptcy I help people to plan what they will do next plan for life after bankruptcy.
Get help and information
Thinking that you have to face these problems on your own is unhelpful and inaccurate. There is help available.
In my work I help people come to terms with, and start to face up to problems they are trying to avoid and ignore. A confidential coaching conversation can be the beginning of starting to plan what to do to face up to the situation. It is also the beginning of preparing the ground for life after bankruptcy.
Read the following:
- the Citizens Advice bankruptcy advice guide
- the Money Advice Service’s guide on options for writing off your debt
You can also contact the National Debtline for bankruptcy advice.
You can get free advice from a debt adviser to help you decide how to deal with your debts.
Working with Toby Ingham
I am an APECS qualified coach and a UKCP registered psychotherapist and I have been working with people for 20 years.
I have built up a track record of success in helping people address problems and achieve their goals.