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The best ways to Recover After Declaring Bankruptcy

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The best ways to Recover After Declaring Bankruptcy

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There’s no doubt that are some considerable financial consequences 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 tough economic times witnessed today means that more and more individuals are filing for bankruptcy. In reality, there are around 20,000 Australians each year that file for bankruptcy. So rest assured, you’re not alone.

Instead of dwelling on the past, it’s critical 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 modifications have 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.

Emotional recovery

It’s typical for those who declare bankruptcy to feel feelings of failure, self-loathing and remorse. Whilst it may seem natural have these emotions, becoming bankrupt is the result of simply another mistake that we all make as humans. You should 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 much easier than you think. The longer you succumb to these negative feelings, the longer it will take to recover. Confronting your financial troubles is the first step in overcoming them, so you’re certainly in a better position than you were prior to filing for bankruptcy.

Self-Evaluation

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. Declaring bankruptcy offers you a second chance to get your finances in order, so it’s best you make the most of it. Whilst there’s possibly a number of reasons why you filed for bankruptcy, all of them probably relate to poor spending and borrowing habits. So it’s a smart idea to create a list of two or three things that led you to declaring bankruptcy and devote yourself to not making these mistakes again.

Make a budget

After you’ve bounced back emotionally from bankruptcy, the next step is to create a rational and manageable budget. You’ll want to consider your earnings and expenses carefully, and work out a way to save money while still paying all of your living expenses. Even if it means that you downsize your house or forego some luxury items, becoming financially stable is your leading priority. There are some easy ways to save money, for instance eating at home as opposed to dining in restaurants and cancelling your gym membership in favour of walking to work. Don’t forget 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 that you pay all your bills on time. Although this won’t boost your credit rating straight away, it will ensure that your rating doesn’t decrease any further. You might want to set up automatic bill payments with 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 considered as the single, most effective action you can take to restore your credit rating.

Increase your income

If you haven’t presently got consistent employment, now is the time to do so. Regular income over time will not only enhance your credit rating but it will permit you to increase your liquid assets, presenting you with more choices. If you’re in a position where you can acquire a weekend job, you should sincerely consider it. Or have a look at your hobbies 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 great idea.

Even though filing for bankruptcy is never an easy decision, it is the first step in dealing with your financial problems and learning from the past so you can enjoy financial freedom in the future. It’s critical that you evaluate the reasons that led to your financial hardships to ensure they don’t happen again. Steady employment and paying your bills on time will increase your credit rating gradually, and sticking to a budget is paramount. If you’re considering filing for bankruptcy and need some advice on your options, get in touch with Bankruptcy Experts Gosford today on 1300 795 575 or visit www.bankruptcyexpertsgosford.com.au

 

By | 2017-11-16T01:44:36+00:00 May 30th, 2017|Article, Bankruptcy, Blog|0 Comments

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