How should you save money during and after bankruptcy?

Bankruptcy is, more often than not, a result of terrible financial crisis and one’s inability to cover insurmountable obligations. It is commonly deemed a crash of one’s financial stability and credibility forever. Well, it indeed isn’t a pleasant thing for anybody. But the very idea that a bankrupt is no better than a financial outcast is perhaps a little fabricated. What gets overlooked in this commonly held idea is that bankruptcy is meant to offer a fresh financial start to debt-stricken individuals.

So, if you have been thinking all this while that bankruptcy will ruin your financial efforts and you will not able to recover, then you are not quite correct. Be assured! Embracing a little financial discipline during and after bankruptcy will work wonders for you. It will not only help you improve your financial condition but also usher in some financial wisdom.

Here is what you can do to save up money during and after bankruptcy:

• Stick to your budget and save up dedicatedly

  While you are going through your bankruptcy proceedings, try to devise a monthly budget plan that will help you track your income, expenses and savings meticulously. Your budget should accommodate a careful savings plan, that is, you should determine an amount that you would deposit in your savings account every month, come what may. Every month when you receive your salary, set aside the amount you intend to save and forget about it. It will not only keep you from overspending but also you will be able to stabilize your finances gradually.

• Distinguish between needs and wants

  The next step towards rebuilding your finances is to stop reckless expenditure. The key to this is to distinguish between needs and wants. You have to understand what your needs are and what are your desires. And then spend your hard-earned money only on your needs and try not to indulge in your wants. Re-structure your spending routine and include it in your budget. Keep least money for your entertainment, at least until you have saved up substantially.

• Say no to credit card

  While you are into the bankruptcy process or even when are you done with bankruptcy, do not open more than one credit card account. The more credit card account you have, higher are the chances of your getting into further debts. So, keep just one account and dedicate it only for dire emergencies. Less use of credit cards will keep you from raking up huge credit card bills every month and you will be able to save up a lot.

• Make bulk purchase

  Another great way to cost curtailment is to purchase goods in bulk. Buying bulk can be quite cost effective. You can do some comparisons to check that out. You will find that buying certain everyday items, such as toilet paper, paper towels or even some food stuffs like cereals, ketchup will cost you much less if you buy them in large amounts. However, this will work only if you stick to your budget dedicatedly and keep your luxuries at bay.

• Adopt some “Do-it-yourself” methods

  If you are physically able to do something, then it is advised that you rather do it yourself than subcontract it to someone else. Be assured, it will be greatly cost-effective. Such tasks might include mowing your lawn, washing your car, taking your dog for a walk etc. It’s all there in your mind. Start looking at things differently. Instead of spending money in these activities, simply invest your time and smartly save quite a lot for yourself.

Saving money after bankruptcy might be a little difficult, but definitely not impossible. Remember, bankruptcy only paves the way; treading on it depends upon you. All you need to do is be wise with your money during and after bankruptcy, and that will improve your financial condition over time.