When considering bankruptcy, many debtors only focus on the process; but the most important part of bankruptcy is after the debtor receives their bankruptcy discharge. It is the time after bankruptcy that the debtor is beginning their fresh financial start. So how does a debtor thrive after they receive their bankruptcy discharge? Let’s take a look at a few tips:
- Live within your means. Creating an easy to follow budget and sticking to it will help any post-bankruptcy debtor thrive. Good budgeting will help you pay your bills on time, manage your cash flow and create a savings account you can use during an emergency.
- Limit your reliance on credit. Many debtors who file for bankruptcy have been dependent on credit access just to pay their basic expenses. Being dependent on credit access will quickly lead you back into financial trouble. To avoid this, use your budget so that you can pay cash for most and preferably all of your expenses after bankruptcy.
- Build your credit history by getting a secured credit card and paying your bills on time. You can also rebuild your credit history and rating by taking out a car loan or paying any bills that survived the bankruptcy on time and as agreed. On time payments reported to your credit bureau will go a long way in rebuilding your credit worthiness.
- Educate yourself about credit and debt. Never sign a credit contract that you don’t understand. Many debtors in bankruptcy have made the mistake of signing onto mortgages and credit card agreements that were not in their best interests. By educating yourself about credit after bankruptcy you will be better positioned to protect yourself from predatory lenders.