Bankruptcy is a scary term...scary to contemplate and scary to initiate. But to give you an idea of how we ended up on this journey, we need to go back to the beginning of yet another journey.
Five years ago, I was single (about to be engaged), owned my own house, had a great job with fantastic benefits and had a moonlighting waitress job that I'd originally taken to pay back a loan to my parents, but kept because the extra cash allowed me a lot of personal financial freedom. I even had a semi-healthy savings account.
Just about four years ago, we were newly married, both of us had sold our "single" houses and we'd purchased a fixer-upper in the country together. And when we sold our homes, we were at just the right time in the real estate market. We both made healthy profits, which we turned around and sunk into our wedding and the fixer-upper (with no regards to maintaining a savings account - if you're counting, this is strike one).
We enjoyed a honeymoon in Ireland that fall. Soon after returning (like, within two weeks), I was called into a meeting at my great job and was informed that our entire marketing department was being outsourced and we were no longer needed. OUCH.
Once I adjusted to that reality, though, I realized I was in a lot better position that my co-workers who were taking the walk with me. Because I had the most years of service, my severance packaged was pretty decent. Salary and benefits would be continued for five months before I'd even have to look at unemployment.
I spent that winter adjusting to my new life as a wife and stepmom and supporting my husband in his family business, which was slooooowing way down (during this time, his paychecks were becoming more sporadic, and my severance was primarily supporting the family).
As spring drew near, I was beginning to panic and was applying to jobs, which may or may not have been suitable. In the end, felt that I landed on my feet, because after one month of having to claim unemployment (a month during which business really picked up for my husband and he got overtime pay), I landed two 20-hour/week jobs, one of which offered cadillac benefits even for part-timers.
Once again feeling financially secure, I spent that summer dealing with our custody battle for my stepdaughter and my dad's brand new stomach cancer diagnosis.
Also during this time, I cashed in my 403(b) from previous great job in order to free up some cash for more house repairs. STRIKE TWO! STRIKE TWO! At least I was aware that we'd be taking a serious tax hit and socked away 25% of it into a one year CD.
Since we were both feeling secure in our employment and had liquidated the money to finish up our house repairs, we began getting a little careless with the credit. We took a family trip to Disneyworld (and I would not trade those memories for anything). We put a lot of tools and home repair stuff on credit cards. We set up an at-home office for me for some freelancing that I was doing. And, at that time, we were able to handle all of our payments, have family nights out and not feel a pinch.
But, oh, the pinch was coming....
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