You can restore your financial health more quickly than you think.
After bankruptcy, you've got a second chance to eliminate the bad habits that got you in trouble.
Build an emergency fund to help you weather unexpected bills or job loss. If your job doesn't offer a group health plan, consider changing jobs. (Half of all bankruptcies were at least partly caused by medical debt.) Create a budget.
Consider acquiring a "secured" (prepaid) credit card, which requires you to deposit funds with the card issuer for a card issued for that amount. (Make sure your payments are reported to credit bureaus — but not as a secured card, which might signal troubled credit.)
Pay bills on time, don't max out credit cards, and don't get a lot of credit all at once. After a year of on-time payments, you can trade secured credit cards for unsecured ones.
Treat new credit card offers with caution. Most will contain limited lines of credit and/or high interest rates. Any loans you get in the first 12 to 24 months after bankruptcy will also carry high interest rates.
Consider taking out a small loan and using the money to open a certificate of deposit, which keeps you from spending it, pays interest and rebuilds credit all at once. Set up automatic payment plans for on-time payments.
Scrutinize your credit reports every four months by staggering your requests for a free credit report from each of the three credit bureaus: TransUnion, Experian and Equifax.
Live within your means. Don't take on unnecessary debt.
Good luck!
|