For a lot of people, bankruptcy must seem like the end of the world, and like hitting the bottom and that there’s no coming back. And it might be true if you keep on falling into the same traps and old habits. Bankruptcy is an opportunity for a second chance, to learn from the past.

In order to find out more about how to deal with this issue, we reached out to the bankruptcy experts at the Law Offices of Mark L. Miller and asked for some knowledge on how to best act in these scenarios when you are trying to recover from bankruptcy and have a fresh financial start. They agreed to share their views, but offer no legal advice in this article.

Contents

Get Your Budget in Order

Beginnings are always hard and changing your habits when it comes to spending and dealing with your monthly income would have to change. You should sit down and write down how much you can earn and how much you can put aside every month in savings.

Then you need to take the rest of the money and carefully plan how you are going to allocate your resources in order to learn to spend only on necessities and not more than you have. It is hard to do that in consumer’s society, but it’s not impossible, and this turning of a new page would open up new possibilities and you’ll probably even learn a thing or two about money and how it makes the world go round.

Make a Distinction Between Wants and Needs

This is very important. This is the key to saving money and getting back on your feet. It is easy to spend money very quickly and worry about it tomorrow, and then bankruptcy happens and you are acting all surprised. You need to learn to be disciplined when spending and to make a difference between what you need to survive and what you desire.

Some people think it’s the same thing, it’s not, you need food to survive, you don’t need a new cell phone if the old one is still working. Until you get back on your feet you should dedicate a drastically smaller amount of money on the fun stuff. As mean as it sounds, try to focus on bare necessities and taking control of your life and spending.

Forget about Credit Cards

Not literally by any means, but you can do that if you like. Owning more than one credit card is a rabbit hole. Just one more thing and I am done, I’ll think about the consequences when the time comes. Well, the time has come and all the recklessness finally came back to haunt you.

As mentioned earlier, it is hard to resist the urge in a consumer’s society where everything revolves around buying stuff you don’t need. Keep a credit card, but use it for emergencies only, when you absolutely have no other option but to use it. This way you will gradually reduce your debts over time and feel much better about yourself.

Learn How to Shop Smart

Make another grocery list, see what you use often and in greater amounts. There are certain items like toilet paper or soap which will always be used. This is the time to be smarter and buy these items in bulk. You are going to spend more money initially but you are saving in the long run.

Also, look for discounts, as well as coupons. It may sound kind of exhausting, but there are great savings to be made if you pick and choose what you buy and when. You don’t have to buy impulsively due to fear of missing out. Be patient, wait out a bit and the item you desire will be discounted.

With these steps, you can start to recover and get your finances back in order and in time, you will have fully recovered.