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bankruptcy blog series

How I Ended Up in Bankruptcy Blog Series {Video FINALE & Q&A}: Should I file bankruptcy?

Today, I’m going to answer some of the biggest questions I’ve received from the Bankruptcy Blog Series.

In this video, I cover:

  • Questions you should ask yourself BEFORE filing bankruptcy
  • What factors you should consider when filing bankruptcy: how much debt do you have, who do you owe it to, etc.
  • What to do instead of filing 
  • Asset Protection
  • And the truth about what would happen to our economy if we all paid off our debt

I’m making this video for you as a wrap up to the Bankruptcy Blog Series.

If you read the series, you heard me talk about my decision to file bankruptcy: how I made it, why I made and how I protected my assets so I was able to bounce back really quickly afterwards.

Today, just two years after filing bankruptcy, my companies are doing better than ever. They’re run by CEOs, and I’m doing just what I do best in those companies as opposed to before I filed bankruptcy when I was trying to hold it all together myself.

I had great companies in some ways, but I was struggling to do it all. I felt like I was all alone. I felt very burdened. I had the wrong business model. I really was making a limited impact in the world.

Today, my impact has expanded greatly, and I’m able to serve in the deepest possible ways. And that was because I was able to make the decision to let go at the right time. And that’s what I covered in the bankruptcy blog series.

So, you all had some questions, and here I am today to answer them for you.

The biggest question that I got asked is:

When should I file bankruptcy? Should I file bankruptcy?

Here’s my answer to you on that: If you are going to file bankruptcy, don’t do it on a small amount.

I filed bankruptcy on over $500,000 dollars of debt. What that meant was that I really, fully leveraged my credit score completely before making the decision to file bankruptcy. Now, if I only had $15,000 or $75,000 worth of debt, it probably would’ve been just as easy to figure out how to make the money to pay off the debt.

And that’s where I want you to start.

If you only have a small amount of debt, I want you to be focused on How can I make more money to, not only pay off the debt, but maybe even take on more debt and leverage all of the resources you have available to you?

That’s really important.

If you’re looking at bankruptcy, you’re really looking at What is the most responsible thing that you can do for the overall situation?

That’s what I did.

I looked at what would be the most responsible thing that I could do. Could I have earned the $500,000? Yes, probably. But would that have been the most responsible thing to do? No, because the way that I would have needed to do it would not have been in deepest service to the world. I could have continued to run the business models that I had created, which were serving in some ways, but they really weren’t of deepest service.

So for me, filing bankruptcy, letting go of $500,000 of debt really made sense.
should I file bankruptcy

For you, would it make sense? Well, we have to look at:

What would it take for you to earn the money to pay back your debt?

If it wouldn’t take much (and sometimes like it feels like it would take a lot, but you just haven’t gotten the right guidance yet, you haven’t got the right support to really tap into the gifts that you have to give to the world. If you can tap into the gifts that you have to give to the world – in the right income model – and pay back the debt, I say do. that. In fact, maybe the debt can be a motivator for you to do that instead of sapping your energy.

Now, if the debt is such an amount that it’s just sapping your energy, and you see no way you could possibly give your gifts in the world and pay back your debt, that’s the time to file bankruptcy.

But again, look at, have you leveraged all of the available credit that you have before you make the decision to file bankruptcy? Have you really tapped all the resources available to you? Because you don’t want to file bankruptcy unless you’ve done that.

There’s another question..

Who do you owe the money to?

If you owe the money to family and friends and colleagues and clients, I don’t think you’re really a good candidate for bankruptcy. Because, is it really the most responsible thing to not pay back those people? No, probably not. Instead, if they are people that are going to be significantly impacted personally in their lives by your decision to file bankruptcy, you really have to look at how can you earn the money to pay back the debt that you’ve borrowed.

In contrast, if you owe big banks and credit card companies, they have built into their algorithms and metrics that some number of people are not going to pay back their debt. So the impact of you not paying back your debt is much, much less significant and in some ways, is part of what keeps the economy going.

If we all decided to pay back our debt, the economy would actually collapse. 

Not paying back your debt is built into the economy as it stands right now, when you are not paying back your debt to big banks and credit card companies. But, if you’re not paying back that debt to clients, friends and colleagues – that’s a whole different story.

In that case, you really want to look at how you can earn back that money. And maybe it involves talking with them, working with them, asking for their support – not just financially but emotionally, maybe strategically. Maybe saying, “Hey, we’re all in this together. How can we come up with the money to get you your money back using the gifts and services and talents that they invested in you in the first place?”

So, those are some of the biggest questions that I got after the bankruptcy series.

Another question that I received is about…

Asset protection – When is the time to do asset protection?

The time to do asset protection is NOW, before you’re facing bankruptcy.

My asset protection started in 2005. I had no idea I was going to file bankruptcy at that point. I barely had any debt at that point. In 2010 I did more asset protection, again, not knowing that I was going to file bankruptcy.

It wasn’t until 2012 that I did file bankruptcy.

So why did I do asset protection in 2005 and in 2010 if I didn’t know that I would be filing bankruptcy?

I’m a business owner.
I’m a risk-taker.
And I want maximum reward for the risks I take with the least amount of personal risk.

I know that setting my assets up from the beginning was the right thing to do regardless of what might happen down the road.

If you have a vision and you’re doing big work in the world, it’s the same for you.

You set your assets up right, out of your estate, outside of any risk of creditors, divorce – anything like that, because you believe in what you’re doing. You believe in the work you’re doing in the world. And you want to set it up to benefit for multiple generations, not just for right now.

So the time to do asset protection is… as soon as you’re thinking about it. 

Once you’re already in debt or you already have risk from creditors, it’s really too late. At that point, any form of asset protection can be considered Fraudulent Conveyance.

Thank you for sticking with me through this series and taking part in the journey.

I hope to see you in the comments!

If you have any questions about anything in the Bankruptcy Blog Series or anything in the video, please leave a comment below.

For anything super private, feel free to email me at [email protected] – otherwise, do post it in the comments and share so that everyone can benefit from your question and our answers.

See you next time!

And keep an eye out for my books “Financial Liberation” and “You Are Not Your Credit Score” in 2015. 

Read the full series here: Part OnePart TwoPart ThreePart Four, Part Five & Part Six.

How I Ended Up in Bankruptcy Blog Series {Part Five}: Finally, My Decision to File

We’ve finally arrived to the part in the story where I actually make my decision to file bankruptcy…

 (Get caught up on the whole series here: Read Part OnePart Two, Part Three, and Part Four.)

So how did I ended up in bankruptcy after building two million dollar revenue-generating businesses?welcome to Bankruptcy

First, let’s do a recap of the main decisions that brought me to bankruptcy:

  1. I incurred $250,000 in debt by selling my million dollar a year law practice to a person who didn’t know how to run a million dollar business, and then having to take back the firm and run it out of my savings and credit. {Part One}
  2. I made a $100,000 commitment (with $87,000 put on credit) to join a mastermind program. {Part One}
  3. I had a $100,000+ tax bill that I didn’t have the savings to pay. {Part Two}
  4. I used my great credit score to purchase land (you know, the farm I swore I’d never live on?) I took on even more debt to purchase land & finance the build-out of a farm. {Part Three & Part Four}
  5. I dipped into the last of my savings & credit to produce a life-changing event for entrepreneurs. {Part Three & Part Four}

All of this landed me in over $500,000 of debt. And, I don’t regret taking on a single bit of it. Most of it was used for very good purposes (I learned a tremendous amount from all of it) and yes, there were some frivolous purchases as well. All of it is and has been repaid back many times over as I use what I learned from each of those investments to participate in creating a world that works for everyone.

So now that I had all this debt, I had to make the decision about what to do with it.

Should I negotiate down the debt? Should I make the money using a business model I no longer believed in? Should I file bankruptcy?

What was the truly RIGHT thing to do?

Negotiating down the debt would take a lot of time and energy. PLUS, it would likely stick me with a big tax bill based on the amount of debt forgiven. That didn’t seem like an awesome plan.

Making the money to pay back the debt felt as if it would suck my soul. The business models I had created were not serving at the highest possible levels. I knew I could do better in and for the world. I also knew it would require a degree of letting go that I had not yet previously experienced to discover something entirely knew.

As I dove into the inquiry around “right” I had to give up all of my preconceived, conditioned notions of right and wrong. My conditioned mind told me that the “right” thing to do would be to pay back the debt, of course. But when I felt beyond the conditioning to what would be truly “right” from the perspective of learning the biggest lessons, making the most space for my gifts to come through most powerfully, and most deeply serving the world, I knew that I would have to give up everything I thought I knew, including my brand, my reputation, my image, my ego and do the unthinkable — file bankruptcy.

In reality, filing bankruptcy was the most responsible decision I could make. So, I did.

I consulted with bankruptcy counsel, two astrologers and decided on the most perfect date to file the bankruptcy, August 24, 2012 it would be. And with that, I was given a Fresh Start.

I moved off the farm and back into Boulder and began to rebuild.

Just two years later, my work is thriving more than it ever has before. The lessons I learned in the process of filing bankruptcy have supported me to create businesses that are sustainable, not just for me, but for all the people who work for the businesses and for the people served by the businesses.

I also got to test out the asset protection strategies I had the foresight to put in place many years before bankruptcy was on the horizon, strategies I believe every entrepreneurial risk-taker should be using in their own lives to protect their work, their families and allow for maximum risk-taking and commensurate impact. They worked. While I had to give up all of my personal assets, my business assets were safe and I was able to rebuild again very quickly.

In next week’s installment, I’ll share some of the details of how I structured my assets for maximum protection as well as how I was able to rebuild and recover so quickly and today be better than ever.

I’ll see you then.

There are just a 2 more installments of this series left!

In the next installment I’ll be sharing how I rebuilt and recovered after the bankrutpcy…
I’ve got a juicy FINALE that you’re not going to want to miss!

Stay tuned for the rest of the story in the upcoming installments of this series where I’ll be discussing my decision to file bankruptcy, how I got there and what happened after I did. And keep an eye out for my books “Financial Liberation” and “You Are Not Your Credit Score” in 2015. Read Part OnePart TwoPart Three & Part Four.