Are you considering filing bankruptcy? If you are, you may be wondering what life will be like after your debts have been discharged. You’ve probably heard a number of myths or you may have assumptions based on some of the facts that you have heard. No matter what you have heard, the idea behind why people file bankruptcy is to have a better financial life, which spreads to other parts of their lives.
In all reality, there are a number of areas that you have to rebuild after filing bankruptcy. These areas include your financial well-being, your credit rating, and your emotional well-being. Rebuilding these areas means living the best quality of life possible. Your Minneapolis bankruptcy attorney will discuss with you the things that you can do to ensure a positive financial future.
One of the most important things you can do for yourself is create a realistic budget. This means living within your means. When you live within your means, there is no need to rely on credit for day-to-day living or to splurge. This means not spending money when it isn’t necessary. Of course it is good to go out to eat with friends or take the family out to the movies, but it may not be ideal to go shopping every weekend and spend hundreds of dollars on things you may never wear or use.
You also want to pay all bills on time. This is because you can avoid late fees and this will leave more money in your pocket. It also doesn’t hurt to put other money saving measures in place where savings can be had. Everything from the grocery store to the amount of utility bills in your home can be altered to free up some of your income.
Once your bankruptcy is discharged, you will be bombarded with credit card offers. You will notice that not every offer is created equal. Some are going to have interest rates higher than others, while there are those with both maintenance fees and annual fees. Unfortunately, the annual and maintenance fees can consume over half of the card’s available credit.
To avoid the fees, the best type of card to acquire is a secured card, which is where you make a deposit onto the card and that deposit becomes your credit limit. Charging small amounts to the card and then paying it back will help rebuild credit. If you keep making on-time payments, the credit card company may give you a credit line increase without needing an additional deposit. Make sure the card you choose reports to the credit bureaus.
There is life after bankruptcy. Before you know it, you can have credit again and you can live within your means so you don’t have to rely on that credit.