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How to Recover from Bankruptcy

Dead end roads, dead end jobs, dead end relationships.  All these are good examples of things that can truly be a dead end.  Notice, however, how the word Bankruptcy was NEVER mentioned as a dead end.  Quite the contrary, Bankruptcy can be a fantastic new beginning that can give you a fresh perspective and fresh start on your road to financial success. Bankruptcy allows you the kind of fresh start you need after a run of bad luck or a series of bad decisions.  By using these mistakes and learning from your bad luck, you can have a great deal of success after bankruptcy. Below, I list how you can successfully recover after bankruptcy.

 

  1. First things first, you MUST learn from your mistakes and misfortunes.  It is important to identify what happened and what caused you to file bankruptcy in the first place.  Was it bad choice, a spate of ill health, a run of bad luck or just plain stupidity. The decision to file bankruptcy was hard enough and let’s be honest.  You probably don’t want to be back here again. In order to avoid this problem in the future, you’ve got to figure out how you got here in the first place.
  2. After you identify your mistakes the next thing you’ve got to do is to plan for the future.  You need to create a budget based on what you can ACTUALLY AFFORD based on your income. Making this budget and sticking to it will lead you to a lifetime of financial success and keep you out of our office in the future.
  3. Once you’ve made plans, the next thing you need to do is set some goals.  Where do you want to be in 1 month, 6 months, 1 year, 5 years or a decade? You need to set goals and work them into your budget.  Such goals should include an emergency savings fund. An emergency cushion should be at least 6 months worth of your expenses in the event you have a job loss or experience medical problems in the future.  
  4. Once you’ve set up goals, you need to work on re-establishing your credit.  The only caveat to this is that it must be done SLOWLY AND DELIBERATELY. You can start out by rebuilding your credit slowly but getting a credit card and using it for a deliberate purpose.  Only buying certain things and ALWAYS paying it off at the beginning of the month. Over time this will allow your credit score to recover once you’ve shown your responsible and able to pay off your debts each month.  
  5. Finally, it’s always best to have a positive attitude.  Bankruptcy can be stressful (although we try our best to ease that stress) and cause a lost of difficulty in life. It is, however, important to focus on the positive aspects of filing bankruptcy. If you let this process continue to kick you while you’re down, you won’t be able to complete the other 4 steps to recovery.  

 

A significant majority of people come out of bankruptcy and find themselves more successful and better prepared for the financial road ahead.  If you feel that bankruptcy might be able to help you improve your financial situation please contact us for a free, no obligation consultation so we can show you just how we can help.  The attorneys at Harmon and Gorove have decades of experience in helping people get back on their feet, recover from financial trouble and achieve their goals.  We look forward to helping you!