How to Avoid Filing Bankruptcy Again?
Your life will change profoundly in the aftermath of a bankruptcy… or at least it should, if you want to ensure your financial stability in the future.
Some of your pre-bankruptcy habits have probably contributed to the challenges you were facing. Thus, to have a better life without financial strains in the future, you will need to come up with a new post-bankruptcy routine.
Here are some of the habits you need to change if you’re going through a bankruptcy and you want to have better financial outcomes in the future.
Not Budgeting
Were you previously comfortable with just spending without holding yourself accountable? This will have to change while you’re going through a bankruptcy and in its aftermath.
Whether you’re going through a Chapter 7 or a Chapter 13 bankruptcy, you will see your financial situation change. Resources will become limited and it will be up to you to spend wisely.
Budgeting helps you establish a bit of fiscal discipline. In addition, it gives you a good idea of exactly how much you’re spending on a monthly basis. Chances are that you’ll be surprised with the number once you make the calculation.
Accumulating Credit Card Debt
Can you get a credit card after going through bankruptcy? Absolutely! The process may be a bit more challenging but some financial institutions will accept your applications and impose less than beneficial terms and conditions on you.
Credit card debt is one of the primary causes of financial struggles in America.
If you don’t change this habit, you will find yourself getting in financial trouble again during and after the bankruptcy filing.
Going for a prepaid card is a much better idea. This way, you’ll be spending only the money that you have and you’ll be thinking twice before finalizing a questionable purchase.
Click here for an article on how to avoid bankruptcy and spare your credit.
Lacking an Emergency Fund
Spending all the money you have at your disposal is far from a good strategy, especially if you’re going through a bankruptcy filing.
You’re in a shaky situation and anything out of the ordinary could get you back in debt.
A medical emergency, for example, can easily contribute to massive financial strain. Lacking an emergency fund to cover for such unanticipated expenses may very well be the end of your new beginning after the discharge.
You don’t have to set a massive sum aside each month. Even a small percentage of your salary will make a good contribution. With time, the funds will add up and give you peace of mind.
Chronic Failure to Pay Bills on Time
This is another detrimental habit that you need to change when you decide to do a bankruptcy filing.
You may think that being late a couple of days when having to pay bills isn’t a big issue. In time, however, a failure to adhere to a repayment schedule can end up costing you a lot of money.
Getting in the habit of paying bills on time is an important aspect of taking control of your finances. Start by creating a calendar that lists all of your bill payments due dates. Getting in the habit of paying on time will reduce stress, boost your credit score and potentially save you money. You may also become eligible for low-interest credit in the future if you prove your fiscal discipline.
You don’t have to do drastic things in order to improve your finances. A few simple changes here and there can quickly add up. You simply have to get in the habit of knowing where your money is going and keeping yourself accountable. If you accomplish these two goals, you may find yourself much better off in the aftermath of the bankruptcy.
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