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Saving Money During and After a Bankruptcy

Updated on February 27, 2013
110killa
110killa

Individuals today don’t file for bankruptcy without a good reason. Most are unable to keep up with their monthly bills and, as a result, have little to no savings. To make matters worse, filing for bankruptcy costs money – both in court fees and legal retainers. To some, the idea of saving money to pay for these expenses and in order to build a new nest egg seems almost impossible – but it’s not.

There are dozens of things you can do to cut back on costs both during and after your bankruptcy proceedings. Following a few of these simple tips will ensure you’re able to regain control of your finances while at the same time starting a new emergency savings account.

Pay Your Savings Account First

As you progress through your bankruptcy proceedings you’re going to create a new budget for yourself. Your budget should include a set amount of money (weekly or monthly) that will go into your savings account. Every time you get paid you should sit down and move that money before you do anything else. The sooner you move that money into your savings account the less likely you will be to overspend in another area, forcing you to tap into that money before it’s gone. Put the money in savings and forget about it.

Stop Wasting Money

In short, you should only buy the things you really need to buy. Underwear and socks are necessities. A pair of $200 designer sneakers is not. Take a close look at your spending habits and determine what you are spending on things you really need versus what you are spending on things you merely want. Give yourself a small monthly allowance for entertainment (or things you want) and then reserve the rest of your money for things you truly need.

A Simple Way To Get Rich After Bankruptcy

Avoid Credit Cards

If you’re filing for bankruptcy you’ve probably already begun, at the advice of your Minneapolis bankruptcy lawyer, the process of closing your credit accounts. Once you complete your filings you’ll want avoid new debt like the plague. Don’t open any more than one new credit account (reserved for emergencies only) after your debts are discharged. Credit accounts are probably part of what got you into trouble in the first place and starting the cycle of monthly minimum payments over again will destroy any chances you have of saving money.

Buy in Bulk

As you start your new life free of financial turmoil you’ll find that it is often easier and less expensive to buy certain products in bulk. While it seems more expensive at the time of purchase you’re actually saving money as the things you would otherwise purchase weekly at a high cost are instead purchased monthly at a lower cost. Of course, this only works if you buy things you need and not just things you want. You know you need to buy toilet paper every week, so buying it in bulk is reasonable and cost effective.

Don’t Subcontract Work You Can Do Yourself

Sorry, folks but this means mowing your own lawn, walking your own dog, and cutting your child’s hair. If you know how to do something, and are physically capable of doing so, then do it yourself. You’ll save a lot of money and will only have to invest a few hours of time.

Some of these things may be a little rough at first but remember this – your old financial habits go you into trouble. Forming a few new ones and building an emergency savings account will do nothing but ensure you’re able to live a debt-free life from this point forward.

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