Millions of Americans find themselves drowning in debt. It could be because of bad money management, but more often results from catastrophic life events such as illness, divorce, or a job loss.
The decision to file bankruptcy is a difficult one, and is not made lightly. Being unable to pay your bills and being harassed by collection agencies causes untold stress and havoc on a person's life.
Although it may not feel like it, there IS life after bankruptcy!
Once you have made the decision to file bankruptcy and have gone through the process, you may be left wondering 'well now what?' Here are 6 tips for beginning again with the fresh start bankruptcy provides.
Create a budget. Outline your monthly bills, and add in quarterly and annual payments. Be as detailed and realistic as possible! Lay out how you will pay your remaining debts on time every month, and stick to it. There are handy smartphone apps to assist you with this.
Open a secured credit card. While you may feel like never using credit again, it's important to re-build your credit score. One of the easiest ways to do this is with a secured card. You will need to put a deposit down with the credit card company in order to open a secured card. Use it sparingly, and the new payments will begin creating positive credit history on your credit report.
Pay your bills on time. Make certain that you don't miss any payments on your remaining debts. Making your payments on time is the single biggest boost you can give your credit score. Plus, having all your bills caught up feels good!
Check your credit report. Pull your credit report and check it line by line for errors. Unfortunately, sometimes delinquent accounts or collections that were included in bankruptcy still show up on your credit reports as active, and this can tank your credit score. If you find any of these accounts, dispute them immediately with the reporting bureau to have them moved under the bankruptcy.
Secure your bankruptcy papers. These documents may be needed down the road when you buy a car, house, or other big purchases. Keep them in a secure filing cabinet or a lock box.
Be patient. Life may not return to normal immediately. However, if you practice patience, stick to your budget, and commit to being fiscally responsible, you will eventually enjoy a financially stable future.