Filing for a Texas bankruptcy is the perfect opportunity for a fresh financial start. However, avoiding money management mistakes is crucial to ensure that you experience that fresh start, instead of falling into the same bad habits. By exercising proper money management, you’ll be able to restore your financial profile to be stronger than it was before! Furthermore, you’ll avoid the risk of having to file for bankruptcy again.
One of the key secrets to life after bankruptcy is proper money management. You will have to work to rebuild your credit and financial reputation. To do this:
- Seek help from reputable sources. There are many resources such as credit counseling agencies and financial advisors who will seek to help you recover after your debt troubles. However, be wary of anyone who claims they can help you quickly rebuild your credit or even remove the bankruptcy from your history. Expect the bankruptcy to stay on your score for up to 7 years, and don’t believe those who say they can help you remove the bankruptcy from your credit report. They might be trying to steal your private information.
- Allow yourself to use credit again. Many who file for bankruptcy are hesitant to enter the world of credit and debt again. However, going on a cash-only basis doesn’t allow you to rebuild credit by using credit responsibly. You want to be able to prove your new money management skills!
- Budget on paper. Keep track of every penny you earn, spend, and save. By keeping a financial record of everything going on, you’ll be able to see the flow of your finances and adjust as needed. This money management skill could have helped thousands of people avoid a Texas bankruptcy.
- Establish an emergency fund. Emergency savings should be separate from your regular savings account. Car troubles, a broken refrigerator, or a lost cell phone can all cost hundreds of dollars that can distract your new money management practices.