You completed your bankruptcy case – congratulations on taking a positive step to improve your future and your financial well-being. You probably feel relieved to have your debt problems behind you. Debt collectors and creditors are no longer harassing you every day, you no longer fear losing your property, and the stress and anxiety you felt before filing bankruptcy is gone. Now it is time to concentrate on your life after bankruptcy. You may be thinking about ways to prevent yourself from getting back into debt. While that is a good plan, it is better to focus on managing your money wisely and preparing for emergencies.
Ways You Can Avoid Getting Back Into Debt
The key to avoid getting back into debt is to manage your money and plan for the future. You may be scared of getting back into debt; however, there will be a time when you will need credit such as financing a car. The debt management course and the credit counseling course you completed as part of your bankruptcy filing provided useful information to help you manage your money, including using credit wisely.
One of the best ways to avoid getting back into debt is to live within a budget. Budgets are one of the best financial tools to help individuals improve their finances. Using a budget ensures that you are not spending more money than you are bringing in each month. When you spend more money than you earn, you run the risk of getting back into debt to cover your expenses. A budget reveals spending habits that you need to modify as well as expenses that you can reduce. Online budgeting tools such as those offered by LearnVest and Mint can help you create a budget and track your spending.
Another important way to avoid getting back into debt is to plan for emergencies and unexpected expenses. As part of your personal budget, you need to have entries for savings and emergency savings. Treat savings as an “expense” that you must “pay” each month. By building your savings, you will avoid getting back into debt if you experience a financial crisis because you will have savings to pay for the unexpected expense.
If you decide to use credit again, pay off your credit card balance in full each month or only charge an amount that you can pay off within four to six months. Using credit wisely will help you reach your financial goals and avoid getting back into credit that you cannot afford to pay.
Contact an Experienced Mount Holly Bankruptcy Attorney
Personal Approach, Professional Service, Affordable Payment Plans
The Law Office of Travis J. Richards, LLC is a full-service Mount Holly bankruptcy law firm focused on Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, debt consolidation, credit repair, tax liens, student loans and foreclosure. We represent clients in Burlington County and throughout South Jersey.
Contact our office at 609-267-5297 to schedule your free consultation to discuss bankruptcy and non-bankruptcy alternatives. You may also use our convenient online contact form and one of our friendly, professional staff members will contact you to answer your bankruptcy questions and/or schedule a free consultation with Travis J. Richards.
Image credit: GotCredit
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