There’s no doubt that are some considerable financial consequences in filing for bankruptcy, and there’s no question that your life will encounter some considerable changes. If you’re in this position, don’t be alarmed. The difficult economic times experienced today means that more and more people are filing for bankruptcy. As a matter of fact, there are roughly 20,000 Australians every year that file for bankruptcy. So rest assured, you’re not alone.

 

Instead of dwelling on the past, it’s imperative that you look towards the future and aim to recover as best as possible. Bankruptcy doesn’t mean the end of the world, it just means that some improvements have to be made to secure a bright future for you and your family. So here are several simple strategies that you can use to best recover after declaring bankruptcy.

 

Emotional recovery

 

It’s normal for individuals who declare bankruptcy to experience feelings of failure, self-loathing and remorse. Though it may seem natural have these emotions, becoming bankrupt is the result of simply another mistake that we all make as humans. You should stop punishing yourself and look towards the future. Bankruptcy is the first step towards financial freedom, and recovering from a bad credit rating is easier than you think. The longer you give in to these negative feelings, the longer it will take to recover. Dealing with your financial problems is the first step in overcoming them, so you’re certainly in a better position than you were before filing for bankruptcy.

 

Self-Evaluation

 

It’s important that you explore the reasons why you became bankrupt to make certain you don’t make the same mistakes again. Declaring bankruptcy offers you a second chance to get your finances in order, so it’s best you make the most of it. Though there’s probably a number of reasons why you declared bankruptcy, most of them probably pertain to poor spending and borrowing habits. So it’s a smart idea to create a list of two or three things that led you to declaring bankruptcy and devote yourself to not making these mistakes again.

 

Make a budget

 

After you’ve rebounded emotionally from bankruptcy, the next step is to create a practical and achievable budget. You’ll need to assess your earnings and expenses carefully, and formulate a way to save money while still paying all of your living expenses. Even if it means that you downsize your house or forego some luxury items, becoming financially healthy is your foremost priority. There are some easy ways to save money, such as eating at home as opposed to dining in restaurants and revoking your gym membership in favour of walking to work. Don’t forget to include in your budget an amount for unanticipated expenses.

 

Pay your bills on time

 

The first step in mending your bad credit rating is to make sure that you pay all your bills on time. Whilst this won’t improve your credit rating instantly, it will ensure that your credit rating doesn’t drop any further. You might wish to set up automatic bill payments with your bank to guarantee that you don’t overlook any payments. This will demonstrate to lenders that you’re financially responsible, and the longer you do this, the better your credit rating will get. This is considered the single, most powerful action you can take to restore your credit rating.

 

Increase your income

 

If you haven’t presently got stable employment, now is the time to do so. Regular income over time will not only enhance your credit rating but it will permit you to increase your liquid assets, presenting you with more choices. If you’re in a position where you can acquire a weekend job, you should seriously consider it. Or have a look at your hobbies and aim to develop a way to increase your earnings by doing something that you enjoy. Cash is king when you’re bankrupt so anyway to increase your earnings is a terrific idea.

 

Although declaring bankruptcy is never an easy decision, it is the first step in confronting your financial troubles and learning from the past so you can enjoy financial freedom in the future. It’s crucial that you evaluate the reasons that resulted in your financial hardships to ensure they don’t happen again. Steady employment and paying your bills on time will increase your credit rating eventually, and following a budget is paramount. If you’re thinking about declaring bankruptcy and need some advice on your options, contact Bankruptcy Experts Hervey Bay today on 1300 795 575 or visit www.bankruptcyexpertsherveybay.com.au