After bankruptcy the most important thing is to make sure you don’t fall into the same financial trap that got you before. Whether you wound up declaring because you went through a divorce, a medical emergency, or your high interest credit cards backed you into a corner there are things you can do now to build up a better defense against financial ruin.
One of the first things you’ll want to do is build up an emergency fund. There are a lot of steps you’ll need to take with your money in the coming months, and years, but an emergency fund should be a top priority. This is a relatively small fund of around $1,500. This way if something comes up (and things often do) you’ll have a way to take care of it. Keep in mind that you shouldn’t touch this unless there’s a real emergency, for instance, you need to fix your car to be able to get to work, your dog needs an unexpected vet visit, or any other unexpected expense you can’t afford. Whenever you do take from this account make sure to replenish it in the coming months. This keeps you from relying on methods like credit cards to get out of emergencies and falling into problems.
Credit cards can of course be a scary trap to fall into. If you really don’t think you can handle it, go ahead and stay away–but if you can, it is smart to use one to build up a new credit history, you just need to use it very sparingly. You won’t be able to get a new card immediately, at least not an unsecured one. Alternatively you can get a secured card from the bank. This will help you build up a new credit history and move forward with your finances.
Once you have built up an emergency fund slowly work on building up a bigger safety net. Three months worth of expenses is a good fund, but really six months of expenses is what you’ll want to have to feel safe in case something happens and you lose your job or something else comes up.
This obviously doesn’t cover everything you can do, but it’s a good start to get your financial life under control and avoiding falling into traps after bankruptcy.
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The more you know the better off you’ll be. Learn more about rebuilding your credit after bankruptcy and all of the things you can do to build up a new history, like buying a car after bankruptcy.