Life After Bankruptcy: Step Three – Knowing Your Budget and Paying On Time - Westgate Law

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Life After Bankruptcy: Step Three – Knowing Your Budget and Paying On Time

So you declared bankruptcy and you’re wondering what to do next. It’s not as scary as many fear.

What’s the first step? Letting Go of the Guilt

Consider bankruptcy as a viable solution – in many cases, the only solution. Finding and implementing a solution to a problem is nothing to feel guilty about. In actuality, implanting an effective solution should be a source of relief and pride. You did what needed to be done. Now make it work for you.

What’s Step Two? Pause to Think

Once you’ve let go of the guilt many associate with declaring bankruptcy, you need to pause to think. Give yourself a moment to consider your past and your future. Consider your support group and if necessary, reach out to additional resources so that you have the needed emotional support as you step into life after bankruptcy.

What’s Step Three? Knowing Your Budget and Paying On Time

It’s important to be realistic and pay attention to your finances post-bankruptcy. Be aware of your income and expenses. For most, this means creating a realistic budget. It doesn’t matter if you’ve never stuck to a budget before – it’s the perfect time to dedicate yourself to the task. Think of your budget as your plan for all spending. It will help you to manage your cash and can be the difference that keeps you from finding yourself in debt all over again.

Generally speaking, a good budget will be a plan to spend less than you earn. In addition, a good budget should include a monthly deposit into a savings account. Savings of this kind can be designated as an emergency fund. Emergency funds can be vital in dealing with emergencies without depending on credit or completely going “off budget.

In addition to living by a good budget/spending plan, pay all your bills on time. If necessary, set up your current bills on automatic payment plans. Pay particular attention to your rent – paying it on time is more important than ever now that it is being tracked by the credit bureau and can make a difference to your credit score.

Get in touch with one of the bankruptcy experts at Westgate Law to find out more about maximizing your finances post-bankruptcy.

About the Author

Justin Harelik

Justin has a singular goal: to get people out of financial distress and move them to financial stability and prosperity. He does this by combining 15 years of in-depth experience in bankruptcy, credit management, debt negotiation and student loan modifications, and he does it with both English and Spanish-speaking clients.

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