Every bankruptcy attorney knows that declaring bankruptcy is the last – not the first – resort for most people who have heavy debts that they can’t pay. A deep debt hole isn’t something people plan on getting into; often it happens because of a job loss, excessive medical bills or some other unforeseeable circumstance. Unfortunately, many times the problem results from a lack of understanding of how to handle money correctly and responsibly. If you have declared bankruptcy and you need help figuring out how to keep the same kinds of financial problems you’ve had in the past from recurring, here are 5 tips for a fresh financial start from a bankruptcy attorney:
Think About How You Spend Money
If your bankruptcy resulted from an inability to budget your income, it could seem like an almost impossible task to adjust your thinking about spending money. You must tell yourself that there can be no good outcome to spending more money than you take in. It can be difficult to accept that unnecessary expenditures must be eliminated. In other words, it’s time to start telling yourself “no.” At the end of the day, you must keep your eye on the prize, which is building up a nest egg that will help you to live more comfortably in the future.
Set A Monthly Budget
The best way to rethink how you spend money is to commit your income and outlay to paper. Once you write down how much money you spend, you’ll be able to cut out, or reduce, some of the unnecessary expenditures. After you’ve made a list of things you spend money on every month, set a strict budget for each of those items; this will help you to have a concrete idea of your financial situation. It’s also helpful to incorporate savings into your budget.
Get More Than One Type Of Credit
If you have overused credit cards in the past, you probably should either avoid credit cards altogether or apply for one or two cards that can help you to rebuild your credit. In addition to a credit card, you should consider taking out a small, personal loan or a loan for a vehicle. If you decide to apply for a credit card or two, use them wisely and pay off the balance every month.
Pay Your Bills On Time
You won’t do yourself any favors when it comes to boosting your credit score if you make late payments on your bills, and that includes rent and utilities. Even if there’s a grace period for paying one or more of your bills, that doesn’t mean that the company you owe money to won’t report your late payment to a credit reporting company.
Monitor Your Credit Reports
According to the Federal Trade Commission, you are entitled to one free copy of your credit report every 12 months from each of the three, nationwide credit reporting companies. It’s a good idea to use these free credit reports to stay on top of your credit reports to ensure that there are no errors or outdated information on them that could be hurting your credit score and the credit you’re trying to rebuild.
Declaring bankruptcy is a long and complicated process. To better understand bankruptcy, how it will affect your financial life and how to get a fresh start after your bankruptcy is discharged, get the help of a bankruptcy attorney. In Dallas, TX, call Collins & Arnove at (972) 516-4255 or visit https://www.northtexasbankruptcy.com/.
Collins & Arnove | Bankruptcy Attorney Dallas TX | (972) 516-4255