I’ve completed my bankruptcy, now what?



I’ve completed my bankruptcy. Now what?

Congratulations, you’ve been discharged from bankruptcy! This means that you can start fresh and rebuild your finances with everything you’ve learned during your time in the bankruptcy process. While your understanding of managing money may have increased, you might still be asking yourself where you can go from here to get started on your path to financial freedom. Luckily, there are some things you can do right now to start building up your credit, and establishing a healthy financial backdrop with which to carry on your life.



Hold onto your bankruptcy paperwork – especially your discharge papers. This documentation will be extremely handy should you want to rebuild your credit and if any lenders or institutions are wanting proof of your discharge. This is also the document you will need should you see any errors on your credit report that need to be corrected, as you will need to prove the bankruptcy dates to the credit bureau.



While this might be an obvious one, it’s important to start putting money away when it’s not immediately needed. A good way to save is to take the money you were recently putting towards your bankruptcy estate and sock it away in a savings account. Having some savings is not only smart in case of emergencies, but it will show your banking institution that you are capable of managing money and opens up the door to start rebuilding your credit.



Not every system is perfect, and if you have recently undergone bankruptcy, it’s possible that information is not updated with the credit bureau. If a debt is showing up on your credit report that was included in your bankruptcy, contact either Equifax or Transunion as soon as possible to notify them of the error. You will need to provide a copy of your Discharge Certificate to prove your bankruptcy.



Start planning for the future! An RRSP account will be a huge help in the long run, and some banks will even provide a loan to deposit into your RRSP that matches your first contribution of $1,000. That $2,000 RRSP contribution can provide you with a refund at tax time as well, which can then help pay off the loan.  We have a whole article on RRSPs here for you if you’re looking for some more information on RRSPs. (Tip: Remember to make RRSP contributions at the beginning of the year so that you get a year’s worth of compound growth!)



If you’re not paying attention to your spending habits, things can get out of control. Make a point of being mindful of your spending, and check your bank statements to see what unnecessary purchases can be sacrificed.



Just because you don’t need to report to your Trustee anymore doesn’t mean you shouldn’t keep up with some of the tasks required of you during your bankruptcy. Once you have a good sense of where your money is going, create a detailed budget that can keep you on track with your financial goals.  Budget for priority items like your bills and savings contributions, and give yourself a set amount that you can have fun with so that you can still enjoy yourself. (Tip: Always spend LESS than you earn. This is key in creating a successful budget that doesn’t rely on loans and credit, and can help rebuild your finances.)



Take it slow with rebuilding your credit. A secured credit card is a great way to start, as the credit limit on the card is secured by a deposit of your own money. Your credit report will show this as a regular credit card, but you will not be at any risk of accumulating debt. This does not mean, however, that you don’t need to make payments; treat this card like any other credit card, and your banking establishment will have proof that you are able to manage a line of credit. Remember: rebuild your credit, but don’t overdo it.


If you found this article interesting, don’t forget to check out some of our other posts! 


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