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Post-Bankruptcy Budgeting Tips

On Behalf of | Oct 10, 2014 | Life After Bankruptcy

When you emerge from bankruptcy, you have a fresh financial start. Thus, it is important to have a clear strategy for re-establishing good credit and finances after bankruptcy. Below are a few tips to consider:

  • Establish your household budget. It is important for your family to create a realistic budget. Look for ways to decrease your expenses and, if possible, increase your earnings. You must commit to living by this budget as closely as possible, at least for a certain period of time, when you can re-evaluate your progress. One way to find out how much you are spending and where your money is going is to track all expenses for several months.
  • Set goals. Decide what your financial long-term goals are, including saving for your retirement or to pay for your child’s college education. Don’t worry if these goals seem out-of-reach right now – they are “long term” for a reason, but it gives you something to strive for.
  • Establish an emergency fund. Many people live paycheck to paycheck, so one unforeseen emergency can destroy them financially. Thus, it is important, that to the best of your ability, you build an emergency fund or savings by setting aside as much as possible each month. Your goals should be to save three to six months’ income.
  • Insurance. If you do not have health insurance, it is helpful for your financial health to obtain it.. Even with insurance, medical bills can be costly. However, without insurance, medical bills can be financially devastating.
  • Rebuild your credit score. While it may seem counter-intuitive to get a credit card after a bankruptcy, it is difficult to rebuild your credit score if you do not have any credit. It is usually wise to start with a secured credit card, which requires you to make a deposit with the lender that will not be touched unless you fail to pay your bill on time. The secured line of credit protects the lender while allowing you to improve your credit score.
  • Pay all your bills on time.

If you are interested in learning how filing a bankruptcy case can benefit you, contact Levitt & Slafkes, P.C., at 973-323-2953. You can also reach us by filling out our online form. We represent debtors in Chapter 7, Chapter 13 and Chapter 11 filings. Let us help you get the fresh financial start you need today.