Chapter 7 is a form of bankruptcy that would involve liquidating your assets in order to obtain debt forgiveness. If you could qualify for it, and if you were under significant financial strain, it could be worth your time to look at the long-term results of choosing this strategy.
This type of debt relief is not suited to every situation. Putting aside for the moment the fact that you would have to satisfy certain criteria before you could file a potentially successful chapter 7 bankruptcy in Tennessee, this article looks at whether you could benefit from liquidation.
Generally speaking, you would benefit more from this form of bankruptcy earlier in your career. The reasons are somewhat complex when you look at the details, so it could be difficult for you to see why selling off assets and possessions — and often taking a hit to your credit score — could result in massive long-term gains.
The main concept at work is that retirement investments tend to be worth more the longer they have to mature. You could have more overall financial freedom in your life by contributing to these accounts — Roth IRA or 401(k) funds for example — instead of paying consolidated debts or chapter 13 payments. You might enjoy exploring this Huffington Post article for a more thorough explanation of the idea of long-term financial gain from total liquidation.
In short, chapter 7 would generally be a better fit for you if you were starting off in your financial life. It could give you an option to settle debts relatively cheaply and allow you to succeed in the long term. However, you should examine your situation closely — no form of debt management is without certain drawbacks. Therefore, please do not think of this as legal advice. It is simply meant as information.