Bankruptcy does not have to be the end of the road when it comes to your finances. In fact, bankruptcy may provide a fresh start. If you are thinking about filing for bankruptcy, you may be wondering what life looks like afterwards. Questions about where to start, what steps to take, and what your finances will look like may all be lingering in the back of your mind when making a decision about whether you should file for bankruptcy.
Whether you file a Chapter 7 or Chapter 13, there are steps that you can take to help you get readjusted to life after bankruptcy. Keeping up with your documents, creating a budget plan, filing taxes, and talking to others who have completed bankruptcy can help you manage better after filing bankruptcy to get back on track.
Talking to an attorney about what next steps to take can be beneficial and help get you on the right track after you are discharged from bankruptcy. John Dunlap is an experienced attorney that may be able to help your case and help make you feel comfortable after bankruptcy.
Budgeting & Sticking with Your Plan
One great thing about life after bankruptcy and taking on a fresh start is that you now have the education and experience to better manage your money because of required financial counseling completed during bankruptcy filing.
Many people who file for bankruptcy had trouble following a financial budget, especially when unexpected expenses made it impossible to stick to a budget. During bankruptcy filing, you’re required to take personal finance classes to help better prepare you for life after bankruptcy and learn strategies to stick with a budget. One of the advantages of filing for bankruptcy is you’re better prepared to manage your finances with a fresh start after credit counseling.
Filing for bankruptcy can give you the tools you need to better manage your finances in the future because of credit counseling provided as part of filing for bankruptcy. If you feel that you’re lost when it comes to managing your money and have significant debts you can’t pay, bankruptcy may be able to help you not only start fresh but be better set up for success in the future.
Saving Money & Emergency Funds
Unexpected expenses, especially medical expenses, are one of the leading causes for filing for bankruptcy. If you want to make sure that you get ahead of your finances this time around you may consider starting an emergency fund. An emergency fund is money that you save in case of an emergency financial situation. Unexpected events that may arise can cause financial strain. When you have an emergency fund on hand, it may act as a safety net.
Not only does an emergency fund provide extra money for a time of need but it also may reduce your stress level, keep you from spending unnecessary money, and may stop you from making poor financial decisions. On top of the benefits of emergency funds it also provides you with money saving habits.
After you have gone through a Chapter 7 or Chapter 13 bankruptcy, you may be wondering if you can begin rebuilding your credit. Bad credit may have been what caused you to file bankruptcy in the first place. Although bankruptcy may remain on your report for a few years, there are steps that you can take to rebuild your credit early on.
Although budgeting your finances and saving money is a great way to stay on top of your finances there are other ways as well. Some things that can help you avoid future debt problems, while rebuilding your credit include:
- Keep up with your credit score
- Obtain a secured credit card
- Avoid credit repair companies
- Pay accounts on time
- Keep balances low
One way you can monitor your credit is by keeping up with your credit score. Checking your credit score frequently is a great way to see where your credit score stands and what you have left to pay off. There are different sites that you can use to check your credit score for free.
Another way you can rebuild your credit is by obtaining a secured credit card. A secured credit card is a card based on a cash deposit. This means that whatever amount you choose to put on the credit card will be the amount credit limit amount that you have. For example, if you put a $300 deposit down, you will have a credit limit of $300. Not only does a secured credit card stop you from overspending and racking up too much credit card debt but it also provides you with an opportunity to pay back your credit, rebuilding it along the way.
Additionally, avoiding credit repair companies may help you with the process of building your credit in the long run. Some credit repair companies may try to tell you that they can take bankruptcy off your report sooner. However, this may not always be the case and may cost you more money without results.
Paying your accounts on time and keeping your overall balances low is a great way to manage your money and keep your finances well balanced. Avoid overspending and make your payments on time in order to rebuild your credit faster.
Life after bankruptcy doesn’t have to be a challenging experience. There are many different options when it comes to saving money and preventing bankruptcy from happening again. Having an experienced attorney who is familiar with your case may be able to help. Call today for a free 30 minute session.