People file bankruptcy for many reasons. Unexpected medical bills can be a financial hardship. Sometimes mismanaged credit spirals out of control. If you decide to file for bankruptcy, you have probably heard the common refrain that “bankruptcy provides a clean slate.“ However, seldom is that phrase followed by suggestions for making the most of a fresh start.

How should you restart your financial future after bankruptcy? Here are a few places to begin:

  • Reflect on your past. Ask yourself why you wound up filing for bankruptcy.. If it was a result of outside forces, like medical bills, then that’s hard to control. However, conducting an honest self-assessment about your financial habits and decision making may be a good idea.
  • Know your credit report. Looking over your credit report for errors and ensure something isn’t negatively affecting your credit score that shouldn’t be. Many bureaus offer free copies of your credit report, making a copy easy to obtain.
  • Start with baby steps. Any change you can make, no matter how small, can make a big difference. If you’ve never set aside any money, saving anything you can is better than nothing. Simply setting a budget could be a meaningful change.
  • Look into a secured credit card. Secured credit cards may be a good option for those looking to repair their credit. Secured credits differ from other credit cards in that the cardholder loads the card up with a small amount that determines their limit. Making these payments each month can help restore credit. Be careful with credits cards after bankruptcy because late or missed payments can negatively impact your credit score. Do your research first.
  • Ask a professional. A bankruptcy attorney or financial professional can offer further advice on what is best in your situation.

There is life after bankruptcy

Filing for bankruptcy can sometimes be the best action to take to improve your financial outlook. Outside forces may be difficult to control but there are practices that you can control. Bankruptcy provides those struggling with their debt with a second chance at a bright financial future. One of the biggest steps you can take towards that future is taking the proper measures to increase your financial literacy.