Financial Steps You Should Take After Filing Bankruptcy

Saturday, June 27, 2020, 6:00 PM | Leave Comment

Filing for bankruptcy is one of many life events that are quite stressful. This is because every coin and asset that you have is dissected.

When it is finally over, you realize that you have reached the beginning of another set of problems.

Indeed, bankruptcy marks the beginning of a new journey that can bring a few goods and more negatives.

It is not an easy process, but you can bounce back regardless.

Begin by looking at your situation through a new perspective and keep looking forward.

Below are some of the financial steps you can take after filing bankruptcy.

Financial Steps You Should Take After Filing Bankruptcy

  • Compose a new budget

    In many cases, a budget that was not well formulated might be the leading cause of your bankruptcy. As such, you now have the chance to come up with a new budget that will not fix you or return you into the same situation.

    Besides, you need to ask yourself several questions at this stage such as “What went wrong?” Or, “why did your budget fail you?” These questions are crucial for you to understand how it happened and to make different decisions next time.

    By understanding the weak point, you will be able to correct your mistake and not fail in the same trap. Before taking any other step after filing for bankruptcy, take your time, and formulate a new budget that is well accounted for.

  • Set up a new saving plan

    Writing a budget earmarks a given percentage of your savings. Still, there is a difference between projecting what you can do and doing it. At this savings step, you need to bridge this gap and make sure you are practically saving.

    To manage your savings, you need to automate your savings. The more you make your money visible, the more temptation you have to spend it. Therefore, you should automate your savings to make sure it is out of reach. If spending your savings has been an issue for you, you must open an account with a different bank where you won’t see your balance whenever you run into a need.

    For your early savings, make sure you direct them to emergency funding. Emergency funding will help you take care of bills. To save up for an emergency fund, you need to decide on what you can spend.

  • Formulate a debt repayment plan

    You will need to submit a consumer proposal BC to help you consolidate your debts. This is considered a legal process that involves your creditors. Through this plan, you can plan your funds and pay for part of what you owe. In this case, the amount that you are required to repay your creditor is based on the amount of money you are making.

    This plan can help you reduce the huge debt you may be having. It will also prevent any other form of debt collection, such as student loan payments. It is one of the better ways to avoid landing into bankruptcy again. This is because you do not qualify for any loan at this point.

    However, it is essential to always be ready as creditors can reject your consumer proposal; thus, you are forced to pay the additional cost. Filing for a consumer proposal is one of the crucial steps of building your credit score. As such, your budget should also accommodate your debt repayment plan.

The bankruptcy process can drain your emotions and be hard for everyone involved. It is important to make sure that you do not fall back into this process of financial powerlessness. Therefore, to put your finances back in order, you need to invest your time and spend many hours evaluating your budget to see if you are meeting your plan accordingly. Make sure that your envelope system is running smoothly.

For several months after filing for bankruptcy, you are going to be busy assessing your credit report and contacting the credit firms to fight for any erroneous reporting. However, the end price of this period will be reduced stress and accountable figures. If you file for bankruptcy, always follow the above steps to help you get back on track.

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