Impact of Bankruptcy on Personal Life

There's been a great deal written about the negative credit rating that affects bankruptcy declarants for years afterward. What's discussed less often is the very real and sometimes crippling emotional impact of having to declare bankruptcy. The negative feelings engendered by having to engage in bankruptcy proceedings can seep into your daily life, adversely affecting your mood and your outward personality, causing you to become further isolated and overwhelmed.



If you've recently declared bankruptcy, and any of the following reactions sound familiar to you, know that you're not alone, and that many other people have been where you are right now.

Strained Relationships

• Relations with co-workers, friends, family and spouses may become strained after declaring bankruptcy, based on real or perceived reactions. You may project feelings of shame or embarrassment onto the mindsets of others, assuming that any odd or cold behavior is a reflection of what is being thought about you. Assumptions such as these, which may be entirely false, can in turn affect your attitude toward the people around you, causing you to adopt a prematurely defensive and confrontational attitude, based on your own internal negative dialogue.

  If you've declared bankruptcy, it's important to remember that any negative attitudes you sense coming from others may not have anything to do with you, but rather with entirely unrelated personal problems in their own lives. For those who encounter blatant, vocal disapproval from someone in their life, understand that this person most likely has a host of personal issues and tribulations of their own. Anyone in your life who handles their unresolved anger by insulting or belittling you is a toxic personality; minimizing or eliminating time spent with such a person is in your best emotional interests.

Fear of Taking Chances

• This is a common reaction if you've declared bankruptcy on a business loan. While declaring bankruptcy is never a pleasant experience, it can feel particularly humiliating if large loans were taken out to start a business that you had high hopes of success for. If your fledgling business utilized or completely centered around your personal talents and aspirations, the personal hurt can be exponentially worse.

  The emotional scars of failure, and the self-abusive internal dialogue that can come for years afterward, can prevent you from ever taking another chance again, keeping you from initiating new projects or business ventures that have enormous potential.

  Before you begin believing any media hype around the supposedly superior and error-free lifestyles of the rich and famous, remember that millionaires such as Donald Trump declared bankruptcy at least once in their lives, before rebounding to further financial success.

Depression

• If the anger and frustration that you feel after declaring bankruptcy is turned inward to an extreme degree over a prolonged period of time, depression--a persistent feeling of sadness and apathy--will often be the result. This depression can take the form of a major depressive disorder, in which the sufferer is rendered unable to take basic care of themselves. It may also take the form of dysthymia, a less severe but nonetheless debilitating and longer-term form of depression.

  With all forms of depression, the sufferers will find themselves having difficulty working, sleeping, concentrating, eating and enjoying activities that once brought pleasure and happiness. Along with the difficulty in carrying out day-to-day tasks, feelings of guilt, hopelessness and pessimism can become pervasive and make the process of healing slower and more difficult.

  It's important during periods of depression to remain in close contact with supportive, trustworthy people, and to remain active through exercise and social activity.