Undoubtedly, this is a challenging time. Not only are you worried about your family’s health, but the impact of COVID-19 also has likely left you concerned about your financial situation.
The closure of many businesses has created significant job and income losses for employees. Employers are likewise hurting, as the governor’s stay home order and requirement to maintain social distancing has prevented many businesses from continuing their normal operations.
Adding to the stress, schools are closed, forcing many parents to stay home to care for their children and homeschool them. Trying to work remotely from home while at the same time caring for and teaching your children is extremely difficult for even the best multitaskers.
I know the first reaction for many people in this unprecedented situation is to panic. I’m no different. When my kids’ school closed, I too felt some panic. How would I possibly continue working and care for/teach my children at the same time?
In addition, a large part of my job as an attorney involves in-person communication — with my partners, my clients, fellow attorneys and judges. But now, most courts are closed to the public, trials and hearings are adjourned or are only being held telephonically, and in-person meetings with my clients and partners are nonexistent.
Financial hardships are inevitable in times like these, but how we handle them can make a big difference in the future. As a bankruptcy practitioner, I have seen firsthand how the fear of not being able to make ends meet can lead people to make rash and, oftentimes, bad decisions.
People drain their retirement accounts, mortgage their homes to pay off debts and wait until the last minute to seek help from a professional — actions that can seriously limit my ability to assist them. My advice during this time is to try to stay calm and understand that there are options for you, both individually and for your business, if you do find yourself in a tough spot.
Bankruptcy might be one of those options. While I realize many people perceive bankruptcy in a negative light, bankruptcy is sometimes the only way to navigate through a difficult time and get an individual or business back on their feet.
For individuals, bankruptcy can prevent a home foreclosure while allowing you to catch up on arrears. It can stop garnishments. Retirement accounts can be protected, as can many of your assets. The list of real and substantial benefits from a bankruptcy goes on.
For small businesses, the Small Business Reorganization Act of 2019 (SBRA) was signed into law last year. This act provides small businesses the same opportunity to restructure as large businesses can in a Chapter 11, but in a much quicker and less expensive way.
My point is, before taking any drastic action, reach out to a professional to discuss what options you may have. I offer free consultations, as do most other attorneys.