Sit down with a spreadsheet (or pen and paper). Figure out your budget and how long it will take you to get out of debt. Some problems are temporary, and this exercise will help you figure out if you can get out ot debt or not. If it's going to take you 30+ years to pay off your debts and you have no money for emergencies then you should probably declare bankruptcy. Because living for 30 years with no emergencies just won't happen. I think bankruptcy is that point where you can't pay all your bills and don't see things turning around (like you are out of work right now, but will be able to catch up when you get a job, good, get a job and then evaluate your finances), But if you are already working a good job or two and still can't pay your bills bankruptcy may be your best option.