Bankruptcy by the numbers

When to file bankruptcy? One rule of thumb: If your total credit cart debt is more than three to five times your monthly income, it may be time to consider filing.

• You are not alone. Luminaries such as Mark Twain, Henry Ford and Kim Basinger filed for bankruptcy yet went on to later success.

• Organize financial data. Chances are, you keep lousy records. Nevertheless, the new law requires detailed financial information from the previous six months.

• See a bankruptcy attorney. There are almost a dozen in the area, and most offer free consultations with no obligation to hire the attorney.

• Consider credit counseling. The new law requires it, and you may be able to come up with a payment plan that avoids bankruptcy. A list of approved credit counselors can be found at www.usdoj.gov/ust/index.htm.

• Pro se or not pro se? Anyone who serves as their own attorney has a fool for a client. However, if you’re single, have no major assets, earn less than $43,436 annually and have time for a crash course in bankruptcy law, it may be worth the effort.

• No major purchases. Buying a $3,000 stereo with your Visa right before you file bankruptcy has a name: credit card fraud.

• Be honest. Really.

• Relax. Once you’ve successfully filed, there’s nothing left to do but kick back and wait. Be thankful that by law your creditors can no longer pester you.

• Go plastic-free. Believe it or not, credit card companies will continue to solicit your business. Resist. Use your ATM card in place of a credit card. Your account will now actually have money in it.