At McElroy & Associates, We Understand That Bad Things Can Happen To Good People

Get A Fresh Start Through Bankruptcy

  1. Home
  2.  » 
  3. blog
  4.  » How should you handle your finances after bankruptcy?

How should you handle your finances after bankruptcy?

On Behalf of | May 3, 2021 | blog, Consumer bankruptcy |

Bankruptcy gives you a fresh start to a more stable financial future. Maintaining the independence that accompanies a debt-free lifestyle will require careful planning.

After the completion of your bankruptcy settlement, you may benefit from learning some strategies for handling your finances.

Use an all-cash budget

Overspending is one of the most common ways that people accumulate excessive debt. If you have a habit of regularly using credit cards to make purchases, you may not even realize how much money you have spent. According to Money Crashers, relying on an all-cash budget can prevent overspending entirely. If you see something you want to buy, only purchase it if you have adequate cash on hand. If you do not, refrain from investing until you have saved up enough money.

As you slowly establish your own financial routine and gain confidence that you can live within your means, you may choose to reintroduce credit cards. Maintain the all-cash budget mentality even when using your credit cards. If you plan to buy something on your credit card, only do it when you know you have adequate cash in your bank account to cover the purchase completely.

Prioritize your savings

Another effective method of handling your money is to prioritize saving a certain amount each month. Be realistic in setting goals for your savings contributions. Develop a consistent routine of paying for necessities, followed by a contribution to your savings account.

You may never know when a challenging situation could complicate your finances. Having a reservoir can reduce your stress and help you avoid going into debt while you make adjustments to your finances.