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How can you ensure that bankruptcy will be successful?

Some California residents are facing thousands of dollars in debt. If you find yourself among them, if might feel like overcoming this debt is a ceaseless task. After years of struggling, you might be ready to wipe your financial slate clean. It’s possible that bankruptcy could be a great option for you.

However, bankruptcy alone will not guarantee long-term success. If you choose to file, you may have to take additional measures to make the most of this opportunity.

Change spending habits

Credit card purchases account for a large portion of American debt. While many California residents end up in this situation because they use their card to cover essential bills, others may need to check their spending. Nobody wants to end up in the same debt all over again.

On a day-to-day basis, expenses can add up faster than you realize. Some of these expenses may even be hidden to some degree, such as ATM fees and even discounts. Contrary to popular belief, sales don’t always pay off. Rebates are easy to forget and buy-one-get-one deals can lure customers to purchase extra.

There are a few ways to get the most of your money. First, review your expenses and look for the purchases you regret and cancel any unused subscriptions or memberships. Second, make a clear budget to prioritize necessities after bankruptcy. If you find yourself forgetting to pay bills by their due date, set calendar reminders with notifications for your phone or computer.

Repair your credit score

After filing bankruptcy, your credit score might be lower than you would like. A low credit score can impact future opportunities, such as loan approval and low interest rates.

Therefore, you may want to find ways to raise your credit score, such as:

  • Disputing errors on your credit report
  • Applying for a secured credit card if needed
  • Keeping credit card balances low
  • Putting aside a few hundred dollars for emergencies

Bankruptcy does affect your credit score, but the benefits of starting over can outweigh any negatives. In order to make bankruptcy work for you, be sure to understand that recovering from debt is a process that may take time and dedication.

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