For many in California, the decision to file for bankruptcy is the most difficult part of the entire process. As the case moves forward, individuals often feel a sense of purpose and are comforted by the fact that they are taking control of their financial future. Once a personal bankruptcy has been discharged, many are filled with a renewed motivation to make better financial choices in the future. The following tips are offered in the hopes of giving those individuals the tools they need to move forward.
Once a majority of debts have been eliminated through the discharge process, consumers should make the utmost effort to live within their means. This begins with making a comprehensive assessment of one's income and basic living expenses. It is impossible to chart a course for responsible spending without a clear understanding of how much money one has to spend.
It is also important to involve one's family in this process. Maintaining a budget is a difficult task, and becomes even more challenging when others within the household are not on board. Share the finances with family members, and ask for their help in sticking to the established budget. This can help cut down on impulse spending, and is a great way to teach kids responsible money management skills.
Finally, consumers should establish an emergency fund. This is an amount of money stashed away to be used in the event of an unplanned expense, such as car repairs, an injury or illness or the sudden loss of a job. Having this in place can make a world of difference if an emergency arises and also gives families a sense of security.
For those in California who are able to implement these and similar tips, the years following a successful personal bankruptcy can be an exciting time. Rebuilding one's financial foundation is a worthy goal and can help avoid becoming mired in debt as time goes by. For many, bankruptcy provides a wake-up call, and those who are able to change the way that they approach money management can have a bright future ahead.
Source: The Kansas City Star, "Money Matters: Six tips to help you live within your means", Jaime Bosse, Nov. 5, 2014