Financial ups and downs are a part of life for the majority of people. There will be times in your life where you may be feeling pretty secure and able to cover all your expenses comfortably, then there can be those times where money is extremely tight and you end up falling further and further in debt. Whether from a loss of a job, an illness, unexpected expenses, or some other reason, you may even find yourself in the position of having to declare personal bankruptcy.
Declaring bankruptcy is an incredibly stressful and often depressing time for people. Unfortunately for some people it’s the only solution that makes any financial sense for them. If you’ve recently declared bankruptcy and are feeling down and confused as to how you can rebuild your credit rating, and start to build a secure financial future for yourself, you’re going to want to read on. Here are some tips that you can start using right away.
1. Don’t Miss Any Bill Payments
Just because you’ve declared bankruptcy doesn’t mean your bill payments have been erased. What this means is that you need to get into the habit of making sure you pay each and every bill on time. This includes big and small bills such as your car payment, mortgage, credit card minimum payment, hydro bill, cellphone bill, and any others.
When you miss a payment, or many payments, it will show up on your credit report and can damage your overall rating. Not only that but you’ll incur late fees, which means you’ll be paying more than you should owe.
2. Set a Strict Budget for Yourself
Over-spending is something that can get you into trouble and lead to bankruptcy in the first place. What this means is that you will want to set up a strict budget that you stick to. If you have a hard time keeping track of your expenses, you can always download a free app on your mobile device that will help you keep track of things. You can track all income, bills, expenses, and so forth. Some even feature reminders and alarms for bill payments, which will help you to remember to pay them.
3. Use Cash for Awhile
While it may be tempting to go out and apply for a credit card with a small limit, it’s best to get into the habit of using cash for a while. This creates a new habit of only buying items if you have the money to cover it. When you do go ahead and get a credit card, this habit will already be ingrained in your head and can help you to stay out of debt.
4. Applied for a Secured Credit Card
Once you are ready for a credit card, you can apply for a secured credit card. You will be seen as high risk, so a secured credit card will likely be the only one you’ll be able to get at first. Just make sure you set a small credit limit. You can then use it for small purchases and make sure you are always paying it on time. This will slowly start to build a credit rating.
5. Start Saving for a Rainy Day
While this tip won’t necessarily help to rebuild your credit, it can help you should you run into financial issues again. It’s never too late to start saving money, and it doesn’t have to be a ton that you put away. Every little bit counts, especially if you are using a savings account that offers a decent interest rate.
By using all of these tips you will slowly be able to rebuild your credit and start to alleviate much of the financial stress you have been under.