4 Ways to Feel More Confident After Filing for Bankruptcy

Bankruptcy can cause people to feel fear, shame, and frustration among many other emotions. Never see the decision to file as an acceptance of failure or a sign of future money problems. Bankruptcy means that you have taken the first step toward a better financial future. The following suggestions can help you feel more confident and move forward.

#1. Accept the Decision

Bankruptcy often happens after people have tried all other options or have looked at the options available to them and decided bankruptcy was the best choice. Do not have regrets over what did not work out, but instead focus on the brighter path that lies ahead. Bankruptcy offers the opportunity to rebuild credit, restart a career, and end the fear of creditors.

#2. Follow Expert Recommendations

Many experts recommend that bankruptcy filers take a debt management class to learn more about debt and credit. The classes can make people more familiar with how the financial world works and how to avoid problems later. Many non-profit organizations around the country and online offer the courses for free. The classes teach people how to manage their money.

Do not confuse the courses with debt management or debt settlement plans. Settlement plans are through third-party services that charge a fee to help debtors secure new financial agreements with their creditors. The bankruptcy proceedings will handle all debt issues with creditors. 

Since 66.5 percent of all bankruptcies take place because of medical debt, it is possible for people to feel they do not need debt education. Consider the course even if medical bills led to bankruptcy. The educational programs focus on credit management and smarter borrowing tips that can help anyone have a better understanding of their finances.

#3. Establish a Plan

Build a budget that reflects how spending and income will look after bankruptcy. Many people describe this moment as a clean slate, but most people still have plenty of expenses to cover. Begin with the idea that something must go into an emergency fund every pay period. Savings accounts reduce the need for risky options like loans and credit cards.

Get help from a parent, friend, or financial advisor to create a realistic budget. The oversight from someone else can help people to stay dedicated to their plan.

It is easy to forget about common expenses and irregular sources of income. Record all spending for a month to discover where all the money goes. The budget should include all sources of cash coming into the home like tax refunds, birthday gifts, and bonus checks from work, not just the paycheck.

#4. Become a Volunteer

People that file bankruptcy will sometimes struggle to overcome their guilt. Some may feel as if they are not paying their way or they have done something shameful. The decision to file would not have been made if it were unnecessary. Selfless actions, like volunteering, can have a positive impact on the psyche. 

Volunteering has many benefits for the community and for the person who donates their time. Even two hours a week could be enough to make an impact. Studies reveal that volunteers suffer less from depression and may even live longer. Volunteering also enables people to meet others, develop new skills, and become more attuned to their community.

Bankruptcy is an opportunity for a better life. Every situation differs, but anyone who undergoes the process should do so because they know it is the right choice for them. At Charles J Schneider PC, we will work with you to ensure you feel confident in your choices and your financial future. Contact us today to schedule a free and confidential consultation.