Trust the government to issue its own employees tone-deaf advice about surviving furloughs, or being forced to work without pay, with cheerful advice like, “become a dog-walker or a babysitter!” Whoever wrote that advice must still be drawing a paycheck.
Other advice: garage sales, Etsy stores, cutting expenses. As if there is a garage sale on the planet that could pay most people’s mortgages or food bills. Some people are turning to GoFundMe pages to get help. Some organizations are actively offering help. Unemployment is an option if you’re told to stay home, but not if you’re being forced to work without pay.
Missing even one paycheck is a hardship for almost anyone.
The truth is, if you’re a government employee, you may face hard financial decisions even if the shutdown ends tomorrow. Even back pay may not be enough to undo the damage that’s been done to your personal financial situation.
And if you’re like most government employees, you’re apprehensive about considering bankruptcy as an option.
Here’s what you need to know.
Remember, employers cannot discriminate against you.
One of the basic tenets of bankruptcy law is no employer may discriminate against you for filing. Filing can’t make you ineligible for promotions. You can’t lose your job as a result of filing for bankruptcy.
Employers include the federal government.
Declaring bankruptcy does not necessarily end your security clearance.
In fact, in some cases it’s the best thing you can do to keep it. The concern with federal employees who have financial problems is that their financial situation could be used to manipulate them.
With a clean slate the government doesn’t have to worry you’ll be bribed or leveraged in some way. Your employer can rest easy, and so can you.
The decision about which type of bankruptcy to file is exactly the same.
Federal workers may file for either Chapter 13 bankruptcy or Chapter 7 bankruptcy. The tests we’d use to determine which bankruptcy to file, including the means test, and your bankruptcy goals, do not change just because you work for the federal government.
In fact, your status as a federal employee should not come into the equation at all. And while certain publications may call filing for bankruptcy a “last resort,” there is no benefit in waiting longer than you have to.
The automatic stay may be just the thing to ease pressure on you and your family during the shutdown.
Are you a federal employee facing bankruptcy? Contact us for a free consultation today. We’re available 24/7, offer payment plans, and are happy to answer any question you might have.