May 24, 2017 0

Effective ways to Recover After Filing for Bankruptcy

Posted by:Charles Bosse onMay 24, 2017

Declaring Bankruptcy,Bankruptcy Advice,Bankruptcy Adelaide

There’s no doubt that are some significant financial repercussions in filing for bankruptcy, and there’s no question that your life will encounter some significant changes. If you’re in this situation, don’t be alarmed. The difficult economic times witnessed today means that an increasing number of individuals are filing for bankruptcy. Actually, there are roughly 20,000 Australians each year that file for bankruptcy. So rest assured, you’re not alone.

Instead of dwelling on the past, it’s vital that you look towards the future and aim to recover as best as possible. Bankruptcy doesn’t mean the end of the world, it just means that some changes need to be made to secure a bright future for you and your family. So here are some simple strategies that you can use to best recover after filing for bankruptcy.

Psychological recovery

It’s usual for those who declare bankruptcy to feel emotions of failure, self-loathing and remorse. While it may seem natural have these emotions, becoming bankrupt is the result of just another mistake that we all make as humans. You have to stop punishing yourself and look towards the future. Bankruptcy is the initial step towards financial freedom, and recovering from a bad credit rating is much easier than you think. The longer you succumb to these negative feelings, the longer it will take to recover. Facing your financial issues is the first step in overcoming them, so you’re certainly in a better position than you were before declaring bankruptcy.

Self-Evaluation

It’s important that you examine the reasons why you became bankrupt to make certain that you don’t make the same mistakes again. Declaring bankruptcy offers you a second chance to get your finances in shape, so it’s best you make the most of it. Although there’s probably a number of reasons why you declared bankruptcy, most of them probably relate to bad spending and borrowing habits. So it’s a smart idea to produce a list of two or three things that led you to declaring bankruptcy and commit yourself to not making these oversights again.

Make a budget

After you’ve recovered emotionally from bankruptcy, the next step is to create a realistic and attainable budget. You’ll have to evaluate your earnings and expenses thoroughly, and figure out a way to save money while still paying all your living expenses. Even if it means that you downsize your house or sacrifice some luxury items, becoming financially stable is your key priority. There are some practical ways to save money, like eating at home as opposed to eating in restaurants and revoking your gym membership in favour of walking to work. Remember to include in your budget an amount for unexpected expenses.

Pay your bills on time

The 1st step in restoring your bad credit rating is to ensure that you pay all your bills on time. Though this won’t improve your credit rating immediately, it will ensure that your rating doesn’t drop any further. You might wish to create automatic bill payments with your bank to guarantee that you don’t overlook any payments. This will demonstrate to lenders that you’re financially responsible, and the longer you do this, the better your credit rating will get. This is regarded as the single, most effective action you can take to restore your credit rating.

Increase your income

If you haven’t already got steady employment, now is the time to do so. Consistent income over time will not only improve your credit rating but it will permit you to increase your liquid assets, providing you with more options. If you’re in a position where you can obtain a weekend job, you should honestly consider it. Or have a look at your hobbies and try to develop a way to increase your earnings by doing something that you enjoy. Cash is king when you’re bankrupt so anyway to increase your income is a great idea.

Even though declaring bankruptcy is never an easy decision, it is the first step in confronting your financial problems and learning from the past so you can enjoy financial freedom in the future. It’s crucial that you assess the reasons that created your financial hardships to ensure they don’t happen again. Stable employment and paying your bills on time will increase your credit rating eventually, and sticking to a budget is very important. If you’re considering declaring bankruptcy and need some advice on your options, get in touch with Fresh Start Solutions Adelaide today on 1300 818 575 or visit http://freshstartsolutions.com.au/bankruptcy-adelaide

 

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