Facing bankruptcy? Moving overseas may help

Photo: Hernan Piñera

The United States isn't out of troubled waters yet. The economy is still on uneven footing, and many find themselves struggling to find work or to buy property. Many are filing for bankruptcy to find financial relief and get a second chance.

According to a report compiled by Lexington Law, Southern and Midwestern states are leading the nation in bankruptcy filings. The top five states with bankruptcy filings per capita were Tennessee, Georgia, Alabama, Illinois and Utah.

Perhaps not surprisingly, the "expat-preneur" has also become more popular, as Americans are moving abroad to pursue business opportunities of their own making. Even if you don't have a business plan in mind, here are a few other reasons why you might consider moving overseas if you are one of the many facing bankruptcy:

Get Free Board

Many jobs teaching abroad come with a salary and free lodgings. Places like South Korea and Japan pay a modest salary comparable to what entry-level positions in the U.S. are paid (around $30,000, give or take) while also providing a free apartment or studio. Many people are able to save a lot of money on basic living expenses and use their salary to pay off debts back in the U.S., such as student loans or credit card bills.

Of course, not all teaching jobs are created equal. If you live in a place where the cost of living is high, you may end up in more financial trouble. If you live in a place where the cost of living is very low, like some places in South America, you may get paid a salary that is enough to live well locally but not enough to put toward your debts back home.

Enjoy a Lower Cost of Living

Typically, if you live in a place that has a lower cost of living, you also get paid a lower wage. However, if you are able to work as a freelancer or to telecommute for your current company, you can take advantage of getting paid in U.S. dollars while living in a place where the cost of living is very low. You could live for a fraction of the price in places like Mexico or Cambodia, but you could bring in a full salary through your remote work.

In such a scenario, you would be clearing up a significant amount of your income to pay down debts or to start rebuilding your savings after a bankruptcy. After a year or more, you could have a nice nest egg to start over anywhere you like.

Reevaluate Your Priorities

When you move abroad, you are not able to take all of the possessions you have stockpiled over the years -- possessions that you likely don't even need but haven't taken the time to reevaluate in years. Living in a new place, perhaps in a smaller apartment, makes you pare down your possessions and re-consider what you actually need to be happy.

You may find that after living abroad for a short while, you have a significantly changed outlook on material possessions and no longer find yourself needing to buy the next best thing. That Change in attitude will have a significant improvement on your financial health going forward.

Moving abroad can not only be a life-changing experience, but it can also be a way to get your finances under control if you make the right choices. If you are facing a bankruptcy or have recently filed, consider what opportunities await you by moving overseas.