The negative connotation of personal bankruptcy keeps people from using it when it may, in fact, be the best financial option. There are many benefits to a personal bankruptcy, especially if you have a family to consider.
By definition, a personal bankruptcy does not mean the end of your financial life. As a matter of fact, the sole purpose of a personal bankruptcy filing is to allow the court system to help you achieve a fresh financial start. If you cannot pay debt, filing a personal bankruptcy informs the court that you are in over your head. The court then steps in between you and your creditors to keep those businesses from taking more money than you are able to pay. This is called the automatic stay.
While you are protected under the automatic stay, you can redirect your money into more important places, such as to pay necessary expenses for your household and family. Just because you have declared bankruptcy does not mean that you cannot use money for important life events such as retirement, children's care and education, medical bills and any other emergency situations.
Although you may not receive a reprieve for every penny of your debt, depending on the type of debt in question, you will certainly gain more financial room than you had without the protection of the court. Do not take the filing of a personal bankruptcy off the table until you read up on what that actually entails. In many cases, personal bankruptcy was the only thing that allowed a family to continue functioning without worrying about making impossible payments.