Dealing With Your Finances After Bankruptcy: Bust Your Budgeting Woes

October 20, 2011 by  Filed under: Bankruptcy 

When it comes to dealing with your finances after bankruptcy, nothing is more effective than a household budget. And while you may regard “budget” as the new four-letter word, the truth is that a reasonable monthly budget is the key to achieving all of your after-bankruptcy financial goals. Whether you want to save up an emergency fund, build up your credit score or just feel more financially stable, a budget will help you do just that.

But there’s a precise science to determining your ideal budget. If you make it too loose, you won’t save any money; too strict, and you’ll lose enthusiasm for it halfway through your financial goals.

If you want your budget to work for you, then you need to make it your friend, not some enemy that prevents you from enjoying life. Even if this is your millionth attempt at making a budget, the key is to tweak each budget until you find the right one for you – and by following the techniques outlined below, you’re sure to find a budget style that will prevent you from falling into the debt cycle again.

Change Your Attitude. If you think that budgets are a bore and are just preventing you from enjoying life the way it should be, then it’s time to check your attitude at the door. Budgets aren’t preventive measures that are keeping you from going on that dream vacation; instead, your budget will help you have enough money to stay out of debt and secure your financial future. Sure, you might have to put off that dream trip for a few years; but will that really matter when you’re sleeping more soundly at night thanks to your on-track financial lifestyle?

Give Yourself Breathing Room Don’t have too rigid of a budget, or a simple financial mistake might be blown out of proportion. If this is your first budget, realize that you’re going to make mistakes, no matter how diligently you follow it. Cut yourself some slack if you make a few mistakes, and then get right back on track.

Make Extra Money If your budget is leaner than fat-free milk, then you might want to consider making extra money to put towards that credit card bill or mortgage payment. These days, you don’t even need to get a second job to see another stream of income. Why not sort through all of your junk and sell it on eBay, or turn your talent for photography into cash by selling pictures to friends and family? The more creative you get with your moneymaking ideas, the more income you can have to supplement your budget.

Have Goals Budgets that are created without a goal in mind are not very successful; that’s why you need to remind yourself everyday of what you’re saving towards. Want to build up an emergency savings fund? Want to stop spending half of your monthly income on credit card payments? Your budget will help you accomplish your dream – and help you live a more stable financial life after declaring bankruptcy.

Reed Allmand, sponsoring attorney for, is constantly looking for ways to provide the best financial information for his clients. Whether you are considering filing for bankruptcy, or are currently going through a Chapter 7 or Chapter 13, visit for up to date news and information you need to know.

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