Don’t People Have a Moral Obligation to Pay Their Debts?

Law Office of Robert L. Firth March 9, 2015

Yes, paying your debts is often the right thing to do. But sometimes you have a higher moral obligation to release yourself from those debts.

The Immediate Benefits of Bankruptcy

Is the decision whether or not to file bankruptcy simply a weighing of its financial costs and benefits? How about if you go beyond just the immediate dollars and cents and include less tangible but still very important factors like the impact on your credit record short-term (possibly hurt it) and long-term (probably improve it)? These questions focus on what’s in your best interest.

That’s fine. You need to find out what’s best for you financially and in other respects that serve your self-interest. It’s why, for example, corporations of all sizes file strategic bankruptcies because their smart and well-advised managers figure out that bankruptcy is the best way to reduce their debt and streamline their operations. That way the business has the best chance of surviving and hopefully thriving into the future.

And that’s a good thing, right?

The Human Dimension

But you are more than a business or corporation. For you the human costs and benefits have to be weighed as well.

That includes things like the detriments and benefits to your emotional and even physical health. The impact of crushing debt on your relationships, with your children, with your spouse and others close to you. And the decision includes morality as well.

The Moral Element

Why morality? Because as human beings we have a need to do what is right. Not necessarily just what is right for you, but also what is right for those around you. What is right for your place in the world.

We humans are moral creatures. Our most important choices often include choosing between doing what’s right and doing what’s wrong. To strip this out of our decision about whether or not to file bankruptcy is to dehumanize us. We need to engage in the moral component of this choice in order to make a deeply good and satisfying decision. Otherwise we’ll likely feel unsettled afterward, no matter what choice we make.

How to Make a Good Moral Decision

1. Accept—own–the choices that you made so far, whether they were good or bad, sensible or short-sighted, intentional or forced—and the circumstances that got you where you are now.

Accept that you have used credit and made purchases which each included at the time a legal commitment to pay those debts. But also consider how much choice you had at the time about those uses of credit/purchases. Consider whether in hindsight you could have or would have done differently. What has changed so that you are now not able to keep those commitments?

2. Consider both the moral costs and benefits of continuing to try to meet those financial commitments.

The main moral benefit would be in keeping the promises you had made to pay those debts. That commitment to pay may be more or less strong depending on the circumstances, especially on how much choice you had at the time (an impulse purchase beyond your means vs. a necessary medical procedure), and what you could or could not realistically anticipate in the future (such as a sudden job loss or illness).

The costs of keeping prior commitments include the potential detriments to your emotional health and even to your physical health from the stress and anxiety. There may also be health effects from the need to work more hours or multiple jobs to try to make enough to pay your bills.

What’s the potential detriment to your marriage and family relationships, and to your relationship with your kid(s)? This includes not just the impact of your stress on these relationships, but also the impact on your ability to meet your financial responsibilities to them. Plus the effect of your debt on your ability to spend the time that these loving relationships require.

Ask yourself: do you have a realistic chance of successfully paying off your debts, and even if so, what would be the likely human costs to do so? And if you really don’t have a realistic chance of succeeding, is it time to stop fighting so that you are not just hurting yourself and those you love as you delay the inevitable, out of embarrassment, pride, or misplaced fear?

3. Recognize that you now, today, have both the opportunity and obligation to make a good decision about whether to continue trying to meet those commitments.

The past and its decisions are in the past. You can now make a decision to do the right thing for yourself and your loved ones.

Recognize that to just go along with the status quo without facing the situation honestly and bravely is to make a decision by default, a decision that likely not your morally best decision.

4. Get advice so that you know your legal options.

You might not think you have a moral obligation specifically to get good advice. But think about it: you can’t make a morally good choice about how to deal with your debts without knowing your legal alternatives about those debts. You cannot know whether there are more morally acceptable ways to deal with your creditors—such as to file a Chapter 13 payment plan instead of a “straight” Chapter 7—if you don’t know your legal options. When you understand the structure within which your choices have to be made, that often helps make the moral choices clearer.

5. Look at each of your legal options, and weigh them in light of your different moral obligations—to each of your creditors, to yourself, your spouse, your family, and anyone else affected.

On one hand, this is an entirely personal decision. You need to look yourself in the mirror and be satisfied that you are doing the right thing. But as with any important decision, you can and most of the time should get help from the right people and resources. Also, consider talking to your closest friend, a family member, a church or spiritual mentor or leader, your accountant. Consider writing in a journal, or praying or meditating about it–doing whatever you think may help you make a good decision.

And although your bankruptcy attorney is primarily just your legal advisor, who will respect that the final decisions are up to you, because he or she has counseled many, many people wrestling with these kinds of decisions he or she may be able to help you with the human element of your decision.


Henry David Thoreau said that the “price of anything is the amount of life you exchange for it.” What is “the amount of life” you are paying for letting yourself continue to be saddled with debt? What crucial parts of being human are you giving up while you avoid figuring out what to do?

It’s time for you to make a good and wise decision. Go get the legal advice so you can do so.