Your debts may have been discharged and you are now looking at bankruptcy in the rear-view window, but that probably does not mean you are now flush with cash or all your problems have disappeared. If that were the typical result, everyone and their brother would probably be beating down the doors to file; however, post-bankruptcy is a time to begin building again, carefully and methodically—having learned from previous experience.
While overspending and mistakes do lead some filers into bankruptcy, for most there is some sort of overwhelming life event that leads to serious financial troubles. You or a family member may have fallen ill and accrued so many medical bills that there was simply no way to pay them. Unemployment or loss of significant income may have been a factor, along with divorce, escalating credit debt, and more.
Hopefully, filing for bankruptcy and having your debts discharged, whether in Chapter 7 or Chapter 13 has helped you, offering that new lease on life financially. It’s important to hold on to that good feeling, making a list of your goals and what you need to do to achieve them. After all the time and effort you’ve expended toward improving your finances, this is your chance to secure a better future. Consider the most important priorities first, with some tips below for success.
- Commit to living below your means. While not always particularly fun, this type of lifestyle does offer much greater peace of mind and will allow you to get ahead if you practice it long-term. Living simply has many benefits, meaning less clutter in your life, less bills, and much greater organization overall.
- Rebuild an emergency fund. If you don’t already have one, open a savings account and begin putting whatever you can in it at first, even if just nominal amounts. The key is to begin. As time progresses, hopefully you can put away enough to equal several month’s pay.
- Work on getting a secured credit card to rebuild your credit. These are easier to get as the lender has a deposit, meaning they don’t lose any money while you show your good faith in responsible repayment. You may also want to try to get a gas card with a low limit that allows for convenience in making fuel purchases as well as helping your credit score. The key is to avoid getting multiple new credit cards and digging a financial hole—which is all too easy to do.
- Keep an eye on your credit score, to see how you are making progress. Also, confirm that the debts discharged in your bankruptcy are noted as so on your report; if not, you may want to file a dispute and continue to follow up until it is resolved.
- Continue after bankruptcy to keep up with non-dischargeable debt like student loans, taxes, and more.
- Start paying into your retirement fund again as soon as possible. If you do not have one, considering opening an IRA and dedicating funds to it each month.
Working on these goals slowly but steadfastly should send you on your way to a much brighter future financially, eschewing unnecessary debt and working to rebuild your credit bit by bit.
If your finances need an overhaul, an experienced attorney from Fitzgerald & Campbell, APLC can review your case and discuss all the available options with you. Our attorneys have decades of experience in serving clients as they navigate through challenging financial situations, to include bankruptcy and other debt management processes. Let us review your case and discuss what would work best for you. We are here to help!