If you are preparing to file for bankruptcy or are in the first few years following a filing, odds are that you have limited or no use of credit cards. Fortunately, there are a few options other than traditional credit cards.
Secured credit cards
Secured credit cards require that you put down a deposit, and your credit limit is restricted to that deposit. In other words, if you put down $500, you can charge only $500. After using your card wisely for a period of time, such as a year, you get your deposit back. You may also be able to convert your card to a traditional credit card if you feel you are ready.
These cards are a great way to begin rebuilding your credit after, for example, a Chapter 7 bankruptcy, but they do come with that required upfront deposit plus other fees. You may prefer to look at other options.
Gift cards are amazing, and they make great gifts to yourself. Need to finance shopping on Amazon? How about at Best Buy? Head to the closest grocery store, and buy a few gift cards. You can now shop online without a credit card, and a staggering range of stores and restaurants accept gift cards. You can also buy gift cards from credit merchants such as Visa at grocery stores, but they may come with small fees. (Some people call cards from Visa and other credit companies prepaid debit cards; sometimes, you can reload money on them.)
American Express Bluebird
Cards such as American Express Bluebird give you expansive ATM access, and your paycheck can be deposited onto the card. Such a service is especially important if you cannot open a bank account due to your credit history. You can also give cards to family members and restrict their spending.
If an emergency occurs-a car repair or something medical, for example-you no longer have a credit card to fall back on. This can be a good thing, as experts generally advise against charging medical bills to your card. One avenue to explore is crowdfunding. When investigating platforms, verify that they allow crowdfunding for the purpose you want, and whether you get the money raised if your goal is not met. People dealing with the effects of Chapter 7 and Chapter 13 bankruptcy have been able to rebuild their lives with the generosity of strangers.
If you are falling behind on your bills, it is best to get in touch with an attorney so that you can determine whether bankruptcy is a viable option. Taking action sooner rather than later gives you more choices.