Your life after chapter: 7 suggestions for additional improvement

Once you file for bankruptcy, you have some breathing space. Your creditors will stop collecting the debts you owe them as the bankruptcy process will govern what will happen to that debt, depending on whether you filed for Chapter 7 or Chapter 13 bankruptcy. And when your bankruptcy is finally over, you will feel even freer as your worst debts are reduced, eliminated, or brought back up to scratch. But it’s also important to make the most of your life after bankruptcy by doing things a little differently to hopefully make sure it never happens to you again.

Make the most of your fresh start after bankruptcy

Tips for a fresh start

The decision to file for bankruptcy is an excruciating event for most people, even if you get completely out of control, causing you to file for bankruptcy. But the best way to think about bankruptcy is how to start over, regardless of how you got to that point. Once you file an application, your after bankruptcy life is a great opportunity to do the important job of getting your financial life back on track and moving in the right direction. Keep these 7 important tips in mind:

Tip 1: Spend less than you earn

spend less

The most important thing you can do after a bankruptcy is to change your entire financial pattern. Your overall goal must be to spend less than you deserve. If you start to spend all or more than you make each month, you will soon be on the verge of financial disaster again. Granted, there are things that happen outside of your control that can throw a key into the workforce. However, if you’re spending less than you deserve, you can build an emergency savings cushion to get you through tough patches as they arise.

Tip 2: open a savings account

saving account

If you can get used to the previous tip, you need to put the money you save somewhere – and forget about it until and only when you absolutely need it. A separate savings account that isn’t easily accessible is a great way to do this. Adding a small amount to a savings account weekly or monthly adds up faster than you think and can be a lifesaver if something unexpected happens.

Tip 3: use less credit

less credit

Few people can get by on a cash budget, but when you have more power over you. The only problem with this approach is that once you’ve filed for bankruptcy and your credit score is still broken, one of the few ways you can easily improve it is by getting a new line of credit and using it responsibly. If you pay everything in cash, nothing will be reported to the credit bureaus and it will take much longer to restore your creditworthiness. But if you are the type who is struggling to manage loans wisely, the less you use them, the better.

Tip 4: be careful with credit repair services

Credit repair services

Many people want to start rebuilding their credit immediately after bankruptcy and turn to one of the many different deals offered by loan repair services. Please be careful before doing this! Many credit repair companies are illegitimate. For more information, see our previous article: Do Credit Repair Services Work?

Tip 5: better budgeting


Improving your financial life after bankruptcy is difficult if you don’t know exactly how you tend to spend and come up with a real plan for your monthly expenses. Yes, you need to create a budget and then stick to it as consistently as possible. You can do this in either a low tech or high tech way, whichever suits you best. US News and World Report has a great list of 10 easy and free budgeting tools.

Tip 6: Pay bills on time


If you have regular recurring bills, such as B. Your utilities regularly late payments, these are often reported to the credit bureaus and affect your creditworthiness. Make your bills your destination on time every time!

Tip 7: educate yourself

educate yourself

Basic financial literacy and household budgeting are mysterious topics to many people because they haven’t been taught in schools in decades. But you can educate yourself. Check out 7 free online courses to improve your financial literacy, or try one of several different financial literacy games to find an easier approach (the ones listed there are meant for kids, but they’ll likely enjoy this too) .

Yes, there is life after bankruptcy. As it turns out, going bankrupt for a fresh start is the perfect time to embrace the seven tips listed above to improve your financial health. And if you want to quickly get your credit back on a new loan, consider financing a car purchase through Day One Credit. We only work with bankruptcy clients to help them get the most out of their fresh start, whether it’s a Chapter 7, Chapter 13, or a recently laid bankruptcy. Contact us for more information or fill out our online application today!

At Day One Credit, we are experts in finding the best possible bankruptcy loans to help our customers buy quality used cars. We are not lawyers, we do not give legal advice and nothing we say should be taken as legal advice. Your first step regarding bankruptcy should always be to seek advice from a qualified bankruptcy attorney.

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