How to Live After Bankruptcy
Posted by Jennifer
What do you do now that it’s all over? There’s an anticlimactic feeling to being done discharging your debts. It’s supposed to be all over, you’re supposed to be free, but how to live after bankruptcy? What do you do now to move on and get your life going again? There are a number of things you can do to move forward.
The first thing to start working on is letting go of your feelings about everything and coming to terms with all that has happened. Often, there was some big event (like a divorce, medical issue, natural disaster, etc) that happened before you wound up in your bad financial situation and then had to go through the process of discharging your debts. This hasn’t given you much time to deal with your emotions. If you are feeling guilty, ashamed, or embarrassed it can keep you feeling scared to make any financial moves. If you’re too scared to do anything financial you’ll never rebuild your credit and be free of all of this.
The next thing to do is start setting up an emergency fund. Set up an initial one of about fifteen hundred dollars so that if anything comes up (flat tire, broken water heater, emergency vet bill) you don’t need to do something like charge up a credit card or get a loan—otherwise known as go into debt. Whenever you have to borrow from this fund, replenish it.
Whenever you have to apply for anything there is one good rule that’s good enough to repeat: shop around, shop around, shop around. Always shop around and read through the terms and conditions anything so that you thoroughly understand anything you are signing up for. A lot of companies that are willing to work with people who have risky credit histories hide large fees in the terms and conditions. This goes for pretty much anything from loans, cards, insurance, and rentals (cars or apartments).
Always have money ready to go for deposits. There is usually a large deposit or collateral associated with any new accounts you open in your life after bankruptcy.
Use some of that deposit money to get secured cards and loans to rebuild your credit. You should work on building up your credit as soon as possible. In the first two years it is important to build a plan and do what you can so that in the years following things will be easier for you. In just a few years you can have an acceptable rating and be able to do things more easily—it doesn’t have to be until your bankruptcy falls off that things get easier for you.
Check your credit report often. This is something everyone should do really, but it’s more important when you have a bad rating and are working on improving your situation. A month or so after things are settled make sure that things were actually marked as included in bankruptcy and not late—and if they’re not marked correctly call companies and keep on them until they do it.
Just because things have changed doesn’t mean you can hide. Adjust, figure out how to live after bankruptcy, and get on with your life.
Tags: after bankruptcy, after bankruptcy goals, credit after bankruptcy, life after bankruptcy