Recession has helped push the personal bankruptcy rate to a 10-year high.

This year's filings should exceed the 1990 figure of 718,107, which was a 16 percent increase over the prior year.Much-publicized financial disasters of major corporations and public figures such as country singer Willie Nelson have made the concept seem more palatable to average folks.

Some filings are necessary, the result of lost jobs or financial emergencies that can't be rectified. However, others attempt a quick fix, and are entered into casually without full consideration of financial consequences.

"It's a mistake when an individual files for bankruptcy simply out of anger at a company that he feels has been harrassing him, or because he wants vengeance against a former spouse to whom he owes money," said Dale Ellis, a Houston attorney who heads the bankruptcy committee of the American Bar Association. "Such people typically say, `Let 'em sue me,' or, `I'll fix them good,' not realizing the implications of their act."

Fully understand the two types of personal bankruptcy before considering them.

In declaring Chapter 7 bankruptcy, the debtor surrenders much of his property to be liquidated with the proceeds distributed to creditors. It shows up on your credit rating for 10 years.

In Chapter 13, the debtor is permitted to present a financial plan to a judge that shows an honest attempt to try to repay most of his debts from future income. It appears on your credit rating for seven years.

Though a Chapter 7 filing lets a person shelter limited, specified property, such as some personal items and some equity in a home, most of the debtor's assets must be turned over to the court-appointed trustee. In addition, certain debts still must be repaid. You'll be liable for alimony, child support and taxes.

"Someone who is 23 years old might feel bankruptcy is no big deal, but six years from now when they get married and want to buy a house, bankruptcy may come back to haunt them," said Judy Kent, a spokesperson for the American Financial Services Association in Washington, D.C.

You'll have difficulty obtaining credit cards after filing for bankruptcy. You'll probably have to settle for a secured credit card, which requires that you deposit a sum of money in escrow.

"Declaring bankruptcy stays on your record virtually forever in some cases, such as with large insurance policies and home purchases," said Jay Muzychenko, vice president of the non-profit National Foundation for Consumer Credit, headquartered in Silver Spring, Md. "Another concern is that landlords or employers may use your credit record as a screen in some instances, which could keep you from getting a certain apartment or job."

There are warnings signs of financial trouble.

"Signs that you're headed toward bankruptcy are that you're not sure how much you owe, you're having a hard time making minimum payments and you're late with all your bill paying," said Kent. "Dipping into food or utility money or skipping needed medical and dental visits are typical signs of trouble."

Before you pull the bankruptcy trigger, talk to creditors, let them know your problems and express willingness to work them out. Perhaps you can devise a repayment schedule with smaller payments over a longer period.

"A credit counselor can help you shut off all those phone calls from creditors by putting together a debt management program," said Muzychenko.

To find the nearest office of the non-profit Consumer Credit Counseling Service, call toll-free (800) 388-2227.

In addition, the American Financial Services Association, 1101 14th St. N.W., Washington, D.C. 20005, provides a free pamphlet titled "What You Should Know Before Declaring Bankruptcy." Send a self-addressed, stamped envelope.

If all else fails, you can file for bankruptcy. Legal fees for doing so typically range from $250 to $1,500.