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Bankruptcy: Deciding whether to build up savings or pay down debt

On Behalf of | Apr 11, 2019 | Bankruptcy

Many individuals in Ohio and elsewhere may consider it vital to begin saving for retirement as early in life as possible. However, those who are dealing with substantial amounts of debt may feel that paying down their debts could be more important than building up their savings. With their financial futures on the line, those who struggle to keep up with overwhelming financial obligations could benefit from seeking relief through outlets such as bankruptcy.

According to experts, individuals may find that the best time to start saving for retirement is now. However, this might not always be an option, especially for those who are carrying high levels of debt, as dealing with debt during retirement can be a stressful process. When it comes to deciding whether to save for retirement or pay down debts, experts suggest that the correct decision may depend on a variety of variables.

Those who carry high-risk debts such as credit card balances with high interest rates may find that paying down their balances could help free up additional income. This sudden increase in income could help better prepare a person to begin building up savings for the future. However, this might not always be as simple as it seems, and as balances continue to rise, so may the threat debt poses to one’s financial future.

Individuals who wish to protect their plans for the future but struggle to do so due to high levels of debt may wish to take steps to reduce their debts, but they may need guidance in choosing a path. By speaking with a bankruptcy attorney, a person in Ohio could obtain advice on each available option for relief. An attorney can help a client make informed decisions about his or her situation and assist in pursuing relief from debts through the necessary channels.



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