Budgeting your way to financial success
Feeling free of financial burdens is something we all want to experience. None of us want to suffer from being bogged down with debts we feel like we can’t stay on top of. Luckily, there is good news after you file for bankruptcy, including the fact that you’re given the chance to start completely fresh.
Filing for bankruptcy in Australia also means you\’re protected from liabilities, beginning from the date you obtain an official Bankruptcy Number from authorities. However, it’s important to note that any debts after this will be solely your responsibility. You are not protected from these.
How to rebuild after bankruptcy
Paving paths to success starts with preparing a budget that allows you to do so. From there, you’ll need to learn how to manage your financials appropriately. The best way to ensure you do this is by creating a clear-cut plan from the beginning.
Don\’t create another budget that will gather dust on the kitchen bench, though. Make one you’ll be happy to follow and can easily read.
Here’s how to do that.
How to create a budget you can stick to
- Calculate your living costs for each pay cycle. Factor in if you\’re paid on a weekly, fortnightly or monthly basis.
- Calculate what you need out of your salary for the bare essentials. That means rent, utilities, car registration, car repairs, insurance, road tolls etc.
- These ongoing costs need to be separated from your salary. That way, anything left can be used for your own personal use – including food, entertainment and interests. If you want to go even further, you can make another budget for this as well.
Keeping on track with your budget
- Make sure all your expenses are documented as an estimate (weekly is best).
- Set up automatic payments for expenses from your main account, a day after your salary is due into your account. Check bills and make sure all reference codes and biller codes are accurate. BPAY is key here.
- Go out and fill up your car, buy any groceries and pay for other essentials (like medication). Now whatever is left is yours to use or save.
After this becomes a habit, you will find its second nature. You’ll no longer think about where your money has gone, but rather think about how far you’ve come. This is absolutely crucial after you’ve filed for bankruptcy and is your first step to financial freedom.