Due to higher costs of living, rising college education costs, and stagnating wages, staying ahead financially can be very hard. In fact, millions of people have very little savings and have to rely on credit cards to get by. Some people can even find themselves in a level of debt that can seem impossible to get out of. While bankruptcy may seem like a good option, it should be avoided at all costs. For those that are struggling financially, there are five ways to avoid declaring bankruptcy.

Negotiate with Creditors

One of the best ways to avoid bankruptcy is to negotiate with your creditors. If you are falling behind on payments, you should reach out to each creditor individually. Major creditors and loan providers will have a team of people that can help you to find a new payment plan. This could result in a lower interest rate, extended repayment term, and other flexible options that can help to lower your payments.

Debt Consolidation

If you are struggling to make payments, another option is to take out a debt consolidation loan. A debt consolidation loan is a lower-interest loan that will be used to pay off all of your outstanding debts. The loans will result in a lower, and more affordable monthly payment, and will allow you to make just one simple loan payment each month.

Establish Budget and Repayment Plan

When you are looking to avoid bankruptcy, it is also important to establish a new budget and debt repayment plan. It is very important to consider what happened to get you into the difficult spot to start with. If possible, you will need to create a budget that allows you to cut back on spending and start repaying your debts more aggressively.

Increase Income

If you are finding yourself in debt, and facing bankruptcy, another option is to find ways to increase your income. There are several different ways today that you can quickly find either part-time or freelance gigs. While these do not pay a lot of money, doing them regularly can add up and help you earn more income each month.

Seek Help

Finally, if you are facing bankruptcy, it would be a good idea to seek outside help for more financial assistance. There are a variety of consumer credit agencies that are designed to help people get out of debt. They can help you by negotiating further with creditors, building a budget, providing more financial education, and helping you find a solution to achieve financial freedom.