Struggling with your finances makes everything harder in your life. You may feel like you can never relax or even answer your phone without worrying about who’s on the other end of the line.
You may feel like choosing bankruptcy will make you look like a failure, but you don’t need to think that way. Don’t be scared of using bankruptcy to help you clear out debts that are holding you back. The right debt-relief choice now could help you save thousands of dollars, protect your home and get you back into a place of financial security.
There are ways to rebuild following bankruptcy
Bankruptcy does have a negative effect on your credit score, but that won’t last forever. If you start rebuilding your credit, then you’ll see that your bankruptcy impacts you less over time.
Here are four tips for rebuilding following bankruptcy.
1. Make your payments on time
To start with, make sure you make your future payments on time. You will want to pay your debts early or on time, so that no additional debts go into collections. Paying on time will help you quickly show that you’re back in control of your finances, which looks good if you have to take out a loan or want to get credit in the future.
2. Put aside an emergency fund
Next, start setting aside an emergency fund. You can do this with automatic withdrawals, which will take money directly from your paycheck to put it into a savings account, for example. You may also want to consider rounding up your purchases in your checkbook, for example, so that you’re saving without really thinking about it.
3. Use credit cards with a deposit
Remember that credit cards can get you into trouble if you can’t pay them back each month, but a card with a deposit is different. These cards still report to credit agencies, but they’re technically already paid for. That means that if you default, the company already has the money. This can be a good way to get used to using credit safely in the future.
4. Review your credit report to fix errors
Finally, review your credit report to check for errors. Removing errors can help it jump up several points or more.
These are four tips to help you rebuild following bankruptcy. It takes time, but you will get back into a place of financial security with good credit.
