There’s no doubt that are some significant financial consequences in filing for bankruptcy, and there’s no question that your life will encounter some considerable changes. If you’re in this scenario, don’t be alarmed. The difficult economic times observed today means that more and more individuals are declaring bankruptcy. In reality, there are around 20,000 Australians every year that declare bankruptcy. So rest assured, you’re not alone.
As opposed to dwelling on the past, it’s essential that you look towards the future and attempt to recover as best as possible. Bankruptcy doesn’t mean the end of the world, it just means that some modifications will need to be made to secure a bright future for you and your family. So here are several simple strategies that you can use to best recover after filing for bankruptcy.
It’s usual for people who file for bankruptcy to experience feelings of failure, self-loathing and remorse. Whilst it may seem natural have these feelings, becoming bankrupt is the result of simply another mistake that all of us make as humans. You have to stop punishing yourself and look towards the future. Bankruptcy is the very first step towards financial freedom, and recovering from a bad credit rating is easier than you think. The longer you succumb to these negative feelings, the longer it will take to recover. Addressing your financial issues is the first step in overcoming them, so you’re certainly in a better position than you were before declaring bankruptcy.
It’s crucial that you take a look at the reasons why you became bankrupt to make sure you don’t make the same mistakes again. Filing for bankruptcy gives you a second chance to get your finances in shape, so it’s best you make the most of it. While there’s probably a variety of reasons why you filed for bankruptcy, most of them probably pertain to bad spending and borrowing habits. So it’s a good idea to create a list of two or three things that led you to filing for bankruptcy and commit yourself to not making these mistakes again.
Create a budget
Once you’ve bounced back emotionally from bankruptcy, the next step is to create a rational and manageable budget. You’ll have to inspect your income and expenses thoroughly, and formulate a way to save money while still paying all of your living expenses. Even if it means that you downsize your house or bypass some luxury items, becoming financially responsible is your foremost priority. There are some easy ways to save money, for example eating at home rather than eating out and cancelling your gym membership in favour of walking to work. Always 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 make sure you pay all your bills on time. Though this won’t increase your credit rating instantly, it will ensure that your credit rating doesn’t decrease any further. You might want to create automatic bill payments through your bank to ensure that you don’t miss 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 powerful action you can take to restore your credit rating.
Increase your income
If you haven’t currently got consistent employment, now is the time to do so. Consistent income over time will not only enhance your credit rating but it will enable you to increase your liquid assets, presenting you with more possibilities. If you’re in a position where you can obtain a weekend job, you should seriously consider it. Or take a look at your interests and attempt 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 fantastic idea.
While declaring bankruptcy is never an easy decision, it is the very first step in addressing your financial difficulties and learning from the past so you can enjoy financial freedom in the future. It’s necessary that you reflect on the reasons that triggered your financial hardships to ensure they don’t happen again. Secure employment and paying your bills on time will increase your credit rating eventually, and following a budget is extremely important. If you’re considering declaring bankruptcy and need some advice on your options, get in touch with Bankruptcy Experts Rockhampton today on 1300 795 575 or visit www.bankruptcyexpertsrockhampton.com.au