If the weight of your financial burdens is becoming too heavy to bear, bankruptcy could be a viable solution. In order to ensure that you don't make the same mistakes that caused you to accrue so much debt in the first place, it's important that you take the time to implement some lifestyle changes after you file for bankruptcy.
Here are two simple changes you can make to help keep your finances in check after a bankruptcy filing in the future.
1. Reevaluate what living within your means looks like.
Many consumers have grown accustomed to a lifestyle that is not conducive to their income level. Activities like eating out several times each week or frequenting the movie theaters can quickly add up. If you want to ensure that you don't get into financial trouble again after you file for bankruptcy, then you need to reevaluate what living with your means looks like for your family.
A great tool that you can use to establish a healthy budget is the 50/30/20 rule. By limiting your fixed costs (household expenses, online subscriptions, etc.) to no more than 50% of your total monthly income, investing 20% of your income toward financial goals (like a savings account or paying off credit card debt), and budgeting 30% of your income for flexible spending (groceries, entertainment, etc.), you can ensure that your spending habits don't get your into financial trouble after your bankruptcy is discharged.
2. Learn to pay for the bulk of your expenses in cash.
The average American consumer is carrying $15,762 in credit card debt alone. Racking up a significant amount of credit card debt can be an easy way to fall on hard times financially, so avoiding this type of debt after your bankruptcy is discharged can be crucial in helping you avoid future financial mistakes.
One of the easiest ways to reduce your reliance on credit cards is to learn to pay for the bulk of your expenses in cash. When you make it a rule to avoid purchasing items that you can't pay for in full, you won't be tempted to build up a significant amount of credit card debt by charging impulse purchases to a card with high interest rates.
Regaining your financial freedom after filing for bankruptcy takes hard work and some lifestyle changes. Learning how to change your financial situation through alterations in your lifestyle will help you experience success after your bankruptcy is discharged. Contact a business, such as New Deal America, for more information.