May 30, 2017Comments Closed

Effective ways to Recover After Declaring Bankruptcy

Posted by:admin onMay 30, 2017

Bankruptcy Experts Mount Isa

 

There’s no doubt that are some tough financial repercussions in filing for bankruptcy, and there’s no question that your life will encounter some considerable changes. If you’re in this situation, don’t be alarmed. The difficult economic times observed today means that a growing number of people are filing for bankruptcy. Actually, there are around 20,000 Australians every year that file for bankruptcy. So rest assured, you’re not alone.

Rather than dwelling on the past, it’s imperative 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 changes 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.

Psychological recovery

It’s usual for those who file for bankruptcy to feel emotions of failure, self-loathing and remorse. Though it may seem natural have these thoughts, being bankrupt is the result of simply another mistake that all of us make as humans. You need 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 much easier than you think. The longer you surrender to these negative feelings, the longer it will take to recover. Addressing your financial problems 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 vital that you evaluate the reasons why you became bankrupt to make sure that 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. Though there’s probably a variety of reasons why you filed for bankruptcy, all of them probably pertain 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 filing for bankruptcy and devote yourself to not making these errors again.

Make a budget

Once you’ve rebounded emotionally from bankruptcy, the next step is to create a practical and conceivable budget. You’ll want to consider your earnings and expenses thoroughly, 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 relinquish some luxury items, becoming financially healthy is your main priority. There are some easy ways to save money, like eating at home as opposed to eating out and cancelling your gym membership in favour of walking to work. Always remember to include in your budget an amount for unforeseen expenses.

Pay your bills on time

The first step in repairing your bad credit rating is to ensure that you pay all your bills on time. Whilst this won’t boost your credit rating immediately, it will ensure that your rating doesn’t go down any further. You might want to set up automatic bill payments with your bank to guarantee 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 the single, most powerful action you can take to restore your credit rating.

Increase your income

If you haven’t already got steady employment, now is the time to do so. Consistent income over time will not only increase your credit rating but it will enable you to increase your liquid assets, presenting you with more opportunities. If you’re in a position where you can obtain a weekend job, you should genuinely consider it. Or have a look at your hobbies and attempt to discover a way to increase your income by doing something that you enjoy. Cash is king when you’re bankrupt so anyway to increase your earnings is a fantastic idea.

Even though declaring bankruptcy is never an easy decision, it is the first step in addressing your financial difficulties and learning from the past so you can enjoy financial freedom in the future. It’s important that you reflect on the reasons that created your financial hardships to ensure they don’t happen again. Stable employment and paying your bills on time will improve your credit rating gradually, and adhering to a budget is paramount. If you’re considering declaring bankruptcy and need some advice on your options, contact Bankruptcy Experts Mount Isa today on 1300 795 575 or visit www.bankruptcyexpertsmountisa.com.au

 

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