Being Responsible With Credit After Bankruptcy

July 10, 2012 by  Filed under: Bankruptcy 

For many people who have come out on the other side of bankruptcy, the overall life improvement is tremendous. They are experiencing freedom once more. They no longer have to fear collectors constantly harassing them; they can make financial choices independent of other financial institutions. The benefits go on!

However, one subject that can be difficult to handle for those who are transitioning into life after bankruptcy is credit. In some cases, it was poor use of credit that landed the person in bankruptcy in the first place. If so, that can make borrowed money a particularly troubling subject.

Handling Credit Responsibly

There are a few things you need to know that can ensure you implement good credit practices in the future. If you pay attention to these helpful tips, you’ll be well on your way to enjoying a life of responsible credit that is bankrupt-free!

  • Have more than one credit card, but only use one regularly. When you have more credit than you actually use, it helps your credit score tremendously. If you have $500 in credit and use $450, it doesn’t reflect well on your credit score – even if you pay off your entire balance every month. Additionally, the less you use a card, the more likely you’ll be careful with your spending habits!
  • Budget well. When you create a budget and commit yourself to it, it’s virtually impossible to incur more charges than you can afford to pay. But, you’ve got to stick with that budget!
  • Don’t shop with a credit card. Yes, it’s a good idea to have a card, and use it, but leave it at home. Use your card for paying bills – not for going out to the store. If you don’t carry a card around, obviously you’re going to use it much less frequently.
  • Work hard on building your credit score, but remember: in this post-bankruptcy time, your primary focus is not on building credit, but on staying debt-free! So, while you’re building your credit score, you should never take out loans that you don’t need just for the purpose of boosting your score. This can be a dangerous practice for someone who is coming out of bankruptcy!

Following these tips can help you transition into life after bankruptcy. Credit isn’t an entirely bad thing. Though it may have been demonized by those who were involved in your bankruptcy experience, you have to remember that a responsible use of credit is a good and healthy thing!

John understands that financial hardships can affect honest, hard-working people. His area of expertise is bankruptcy law and aims to provide all his clients with the fresh start they are looking for. His business philosophy is guided by one thing, helping people get back on track. As a Denver bankruptcy attorney his practice has given him the opportunity to directly impact the lives of many people.

Article Source:
http://EzineArticles.com/?expert=John_A_Cimino

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