You might feel embarrassed about having to file for bankruptcy. That could lead you to want to keep it a secret from everyone.
Most people need never find out, but it is certainly worth telling some close family members. Here are a few reasons why:
It may affect them
If you are married, your finances will be tied to your spouse’s to a certain degree, so you definitely need to talk to them about it because it could directly affect them. This is just as true if it is a business bankruptcy as a personal one – they still need and have a right to know.
Your kids probably need some information, too. What you give them will depend on their age and maturity. A toddler might worry it’s their fault because they asked you for an expensive toy for their birthday, so you’d need to reassure them it’s not. Your teenager might have to look again at college options to find somewhere less expensive than their initial choice.
They can offer support and help
Maybe your child offers to get a Saturday job so they can pay for themselves when they go out instead of asking you for money. Maybe your brother offers to loan you some money rather than you file for bankruptcy. Or perhaps your mom just gives you a big hug and tells you it’s OK, and that they know plenty of people who have been in your position and it’s nothing to be ashamed of. Whatever they offer, your family’s support could prove invaluable. But they can’t provide that until you tell them.
Learning more about how bankruptcy works will leave you better informed to answer any questions your family may have.
