I declared bankruptcy at 28 when my $60,000 debt became overwhelming. It was the right decision - and the stigma needs to end.

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I declared bankruptcy at 28 when my $60,000 debt became overwhelming. It was the right decision - and the stigma needs to end.
Bankruptcy has a stigma that holds back people in debt from seeing it as a realistic option. Aleksandar Nakic/Getty Images
  • Mike Amory is a LMSW social worker and comedian based in New York.
  • Two years ago at 28, Amory declared personal bankruptcy after accumulating over $60,000 in debt.

In 2018, I was psychiatrically hospitalized at Zucker Hillside Hospital and banned from having potentially dangerous devices like pens and shoe laces. I thought it would be the most helpless I'd ever feel.

In reality, deciding I needed to declare bankruptcy a year and a half later felt worse.

I declared bankruptcy at 28 when my $60,000 debt became overwhelming. It was the right decision - and the stigma needs to end.
Author Mike Amory. Mike Amory
While hospitalized, I was diagnosed with Borderline Personality Disorder and told the most effective treatment was Dialectical Behavioral Therapy (DBT). Unfortunately, DBT is intense and expensive, with costs easily surpassing a thousand dollars a month from a combination of weekly individual and group sessions and phone coaching, where you can contact your therapist during the day if you are experiencing an emotional crisis.

On top of that, providers rarely take insurance, and soon after I was hospitalized, my full-time job became part-time and I lost all my benefits. Between the cost of therapy and rent, I quickly started accumulating debt. Soon I was frantically rotating credit cards and transferring balances, doing anything I could do to keep my interest rates down and purchasing power up to get through another day. I still remember the fear that came when I'd take out my card and wonder if this was the purchase that would be declined.

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Carrying around a large debt is like wearing a scarlet letter only you can see.

Its dominance over your life becomes overwhelming. You become your debt, and it seeps into every aspect of your life. Despite having accrued $60,000 in debt, I resisted declaring bankruptcy for over a year. Our society presents bankruptcy as a moral failing - an outcome to be avoided at all cost.

It's time to kill the myth that says bankruptcy and morality are linked. People my age are questioning capitalist propaganda now more than ever, and bankruptcy should face the same scrutiny.

Bankruptcy is not immoral, because immorality suggests trickery or fraud.

Every financial institution you engage with works contracts to their advantage. Every lender is aware that anyone they lend to can declare bankruptcy and wipe away their debt.

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Similar to how a bank feels no guilt increasing your interest rate if you miss a payment, you should not feel guilty for doing the best thing for your financial health.

Your debtors are allowed to show up in court and challenge your bankruptcy application. None of mine did, and I didn't see a single one show for the dozens of other people I saw during the two hours waiting for my case to be heard. In my opinion, that shows how much it matters to these financial institutions.

A recent survey by Bankrate showed that people feel more comfortable talking with others about their weight than they do their credit card debt. This association between debt and morality has been long ingrained in our society, but it's important to ask who benefits from that? We know credit card providers made over 100 billion dollars in interest fees in 2018, and it's increasing at a rapid rate year-over-year.

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Bankruptcy does have its consequences. It will show up in background checks and it can make it very difficult to buy a car, rent an apartment, or get a mortgage. The myth that you cannot get any of those things post-bankruptcy is incorrect. You can get government-backed FHA and USDA mortgages three to four years after bankruptcy and after seven to 10 years, your bankruptcy completely disappears from your credit report.

After factoring in my age and the general plan I had for the next 10 years of my life, I felt declaring bankruptcy was in my best financial interest.

Two years after declaring bankruptcy, I'm happy to say I made the right decision.

I encourage others to consider bankruptcy as well, regardless of how you ended up in debt. There's no special honor in paying interest rates on a debt for years to come. There will be no portrait of you hung up in the bank's headquarters praising your moral commitment to your debt.

Almost two years post-bankruptcy, I'm newly graduated with a Masters degree in social work and about to start a job with a yearly salary that is about the same as the debt I had legally discharged. My life isn't perfect, and I have fresh student loans to pay off (another myth that you can't discharge student loans in bankruptcy is not true) but I now also have the means to pay them off over time, thanks to the difficult decision I made to declare bankruptcy when I did.

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Mike Amory is an LMSW social worker and comedian living in Brooklyn with his two cats, Shy Guy and Brave Cat.

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