Getting back to life after a financial fall or bankruptcy means you have to change your lifestyle significantly. One thing for sure; you do not want to wind up in the same spot again. It’s no wonder you’ll need to start monitoring your credit report, cut down on expenses, draft a new budget that fits your life, and begin saving again.
1- All eyes on Your Credit Report
Credit is killing many people’s financial lives. And credit cards are the main culprit. So from now onwards; all eyes on your credit report. Your creditors should discharge all debts on you after bankruptcy. So when checking your report, ensure all outstanding debts are marked as discharged and have a lawyer discuss it with your creditors so the appropriate actions are taken.
Also, you should make a habit of monitoring your report after 2 or 3 months to make sure you are indeed getting back to life. If you have to borrow, this time go for loan options that are easy to repay and won’t negatively affect your credit. Check the provider’s lending details before signing a deal.
2- Do away with money-wasters
The fact is; most of us know where we get extravagant with the spending. And the period after bankruptcy is not a time to dilly-dally on such important financial decisions. So if you’ve figured out where you can reduce your spending without straining, then it’s time to take the bold step.
Sorry to say, but you can’t live a superstar’s life on a regular job’s salary, especially after you’ve suffered bankruptcy. Consider reducing expenses on things like housing and transportation. Cut down on housing bills; they often eat up more than half of what you earn. If possible, find a new place that will allow you save more.
Cozy transportation is also costly. A big car will eat up all your money on fuel and insurance. Why not switch to something more affordable?
3- New life, New Budget!
If it’s out with the old then let it be, you don’t want to try the same tricks that got you broke. Think of drafting a budget that fits your new lifestyle. Simply cutting on a few costs won’t help you recover financially, you should figure out how to spend the amount you earn.
Begin tracking all of your spendings to spot areas where you can start saving. Come up with a budget that touches all aspects of your life including food, clothing, and other personal expenses.
Also, remember that though it may take time to get used to your new budget, it’s crucial that you work on that.
4- Start Saving Once more
The three starting steps will ensure you spare some money to save. Set aside a percentage of your income to finance your retirement, and always ensure your contributions are maxed out. Also, you should consider putting aside a portion of your earnings for personal emergencies. That way, you will avoid unnecessary incurring debts.
As you work to fix your finances, be sure to avoid repeating your previous mistakes. It is wise to consult a personal financial adviser if you’re not sure of your moves.