5 Ways to Repair Your Credit After Bankruptcy

It is never easy to go through bankruptcy, as it is something that would have caused a tremendous amount of stress over the previous years. Financial problems are one of the worst things to go through in life because it can drag on for years and years and take its toll on your health and those who are near and dear to you.

However, once the ordeal is ‘over’, there are things you can and should do, one of which is to try and rebuild or repair your credit and to avoid the pitfalls in the future, so let’s take a closer look at the ways to try and do this.

1. Create New Habits

You more than anyone will know how you got into financial problems leading to bankruptcy. This time, you need to get away from all those old habits that got you into the mess in the first place. Even when you were going through this, there may have been certain behaviours or patterns that kept you in such a bad state. Therefore, you really need to change your financial mindset, otherwise, you are going to go through the same thing, as you try to rebuild your credit.

2. Have An Emergency Fund

From now on, you need to set some money aside for emergencies and you need to stop relying on credit. You may have already taken the steps to rebuild your credit. You do not want to ruin this in any way. If you have an emergency fund set up, you will have the money to take care of any unexpected expenses that may crop up.

3. Don’t Get A Credit Card Just Yet

Rebuilding your credit isn’t going to happen overnight, so take your time and be careful. If you have not created a budget, you need to do so. When you do, make sure that you are able to work with this first. Do not start to rely on credit and borrowing just yet. If you have no plan in place and start taking on new debts, well, you’ve been down this road before, haven’t you? If you start doing this again, it really defeats the purpose of filing for bankruptcy in the first place.

4. Multiple Credit Cards

When the time comes, be smart when securing new credit. Whatever you do, do not make the mistake of getting several credit cards. People actually do this, which is mind-boggling! Nothing good will come of this, otherwise, the whole world would have caught on by now! If you use credit, it is because you want to rebuild your credit score. It is not for buying umpteen things which you may or may not even need. It is time to make some sacrifices. Your new credit card (when you finally get one) is something that should not put you in debt again.

5. No More Balances

There are times that you have to use your credit card, but make sure it is only for something that you have budgeted for. Once the bill arrives, you must pay it off in full. On other occasions, leave the card at home and only use whatever money you have on you to make purchases, otherwise temptation will take over.

Do not get a credit card sooner than needed. You want to rebuild your credit, but do not incur more debts in trying to do so. Create a budget and stick to it. Use your past as a motivational factor and tell yourself you will never be in that boat again.