It can happen so fast. Financing here, an installment plan there, the car gets leased and a loan is taken out for the next big party. Before you know it you're sinking into a mountain of debt. No longer able to pay off the installments or repay the loan. Broke, what now? What happens in the next steps, are there ways to tackle it, and how big are the chances of ever being debt-free again?

Broke, What Now, When Debts Grow Over Your Head

The installments for the financed living room can no longer be paid. The reminder letters are stowed away unopened in a drawer with a heavy heart. Broke, what now? Hoping that the creditors have as long a breath as possible. But as always, in this case too, after too long a time the debt collection agency will step in to collect the debts.
Collection means roughly "getting money in." If you stop paying the installments, many creditors bring in a debt collection agency. In Germany, it may only collect the debts from those affected with court approval. For large amounts, an installment plan is often possible, and this should be settled with the collection agency right away.

Broke, What Now, When Personal Bankruptcy Is the Last Resort

Many people have no other choice and file for personal bankruptcy. The circumstances in which they no longer know how else to help themselves vary widely. Often those affected end up in the debt trap unintentionally. They take out financing or loans for their partner and at some point can no longer service them.
Under the German system at the time of writing, personal insolvency lasts seven years. If you go for this way of paying off debt, you give up the right to keep more than 1,000 euros of your money. In addition, you may not take on any new debt during these 7 years, otherwise immediate termination looms and all debts have to be repaid at once.

Broke, what now



Broke, What Now: A P-Account Is a Good Alternative
A so-called P-Konto (garnishment protection account) in Germany is an ordinary checking account in which the balance, whose amount is set by law, is protected from various account garnishments by creditors. This guarantees that rent, electricity and so on can still be paid, and it also secures a certain amount that is available to you for buying groceries.

Broke, What Now, How Do You Get Money Fast?
If you want to get money fast, the internet is a good platform. For example, sign up with platforms that award points for answering consumer surveys, which after a while can be exchanged for rewards. Shooting videos, writing blogs, producing your own channels: discover your talent and earn small or even larger sums on the side. But jobs like delivering newspapers, handing out flyers or helping out neighbors can also often help you get quick cash.