Handling Finances After Bankruptcy
Everyone can have bad luck such as losing a job or an extended illness, but if we are honest, many of us face financial problems because of poor money choices. While there is no “blame” attached to a bankruptcy, it is clear that if poor money management lead to this situation that a change may be in order moving forward.
Principles of Good Money Management
Like any skill, money management is not necessarily one we are born with. It is very possible to learn good money management skills and apply them in your life with some practice. Here are a few tips on managing debt that may be of help as you move forward from a bankruptcy into responsible handling of finances:
- Pay off credit cards immediately. The initial trap into which most people fall is credit card debt. What starts as a simple charge can quickly spiral into uncontrollable debt including interest, penalties and fees for late payments. Make a plan to pay your credit cards off immediately, but most importantly do not charge anything else until they are paid off.
- Set up a budget. Rather than a negative, see a budget as a positive. A budget allows you to spend within your means and gives you the freedom of knowing you are not going into debt for unwanted or unneeded items.
- Use a cash system. Some people advocate a system whereby you designate certain amounts of cash per month for certain expenses. For example, some people say that by taking cash to the grocery store, they are forced to live within their food budget. Using a debit or credit card could make it too easy to overspend. Every month, take out a certain amount of cash and divide it up immediately into weeks or other time periods. When the time comes to go shopping, taken only that amount of cash.
- Ask for help. There is no shame in admitting that you may need to learn help with managing your money. Turn to those who are experts in this field, even if it is only a family member who is good at money management. You may also want to take free classes at a local community college or adult education center to help you learn more about successfully handling your finances.
When you take the time to handle money correctly you save yourself a great deal of stress and problems. Oswalt Law Group in Phoenix is ready to help you explore the benefits of bankruptcy to give yourself a fresh financial start so that you can begin your financial journey anew.