Filing for bankruptcy provides you with a clean slate by discharging applicable debts. To make the most of this second chance, you should devise a budget that will allow you to meet all financial obligations while still living within your means. This will prevent you from accumulating an overwhelming amount of debt in the future. If you’re unsure how to go about devising such a plan, here are a few tips for getting started. 

3 Ways to Live Within Your Means After Bankruptcy 

1. Account for Fixed Essentials 

Fixed essentials are necessary expenditures that cost your household the same amount every month. Examples include rent or mortgage payments, car payments, and insurance premiums.

If you’re unsure what to budget for the most expensive necessities, financial planners generally advise clients to spend no more than 30% of their gross monthly income on housing and no more than 15% of their after-tax earnings on transportation. 

2. Determine Flexible Obligations 

Flexible obligations are those that fluctuate from month to month, like groceries, gifts, and clothing. While these are essentials, they offer some flexibility when it comes to budgeting.

If you’re having an especially lean month, for example, you can plan meals around foodstuffs that are on sale. Additionally, you can give thoughtful, handmade gifts to family members who have celebrations that month. 

3. Set Aside Some Savings 

Building up an emergency fund will ensure you have money when an unanticipated expense arises. This will prevent you from having to take on more debt to cover it. From car repairs to vet bills, life is full of unexpected expenditures, so get in the habit of setting aside a portion of each paycheck. Even if you can only afford to save $40 a check, that works out to more than $2,000 a year if you get paid weekly. 

To see if bankruptcy will resolve your financial woes, turn to Bueker Law Firm. From their office in Stuttgart, this firm has been serving clients across central and southeast Arkansas since 2001. Led by attorney Jeremy Bueker, their areas of expertise include discharging debt, fighting foreclosures, stopping garnishments, preventing repossessions, protecting cosigners, and removing tax liens. To discuss your debt relief needs, reach out on their website or call (870) 673-1313.