Tag Archives: saving money after bankruptcy

Tips on creating new rewards by playing the money saving game

Saving money is just as easy as spending money when you save a little at a time. Have you ever considered making a budget and thought you had more money to save until you realized that you spend more on gas, food and extras? Spending and saving money are simple habits that we develop. The same way we get in the habit of stopping for coffee on the way to work, we can just as easily get in the habit of making coffee at home and taking time to read the newspaper before leaving the house. There are many articles written on theories and plans for budgeting money. As you consider them, you may find something that speaks to you and makes sense. However, you decide to budget and save to get ahead, doing something is better than nothing and every big goal is reached by many small steps.

Budgets and discretionary spending money

Discretionary spending is supposed to be the use of money on little things we want here and there after our primary financial needs have been met. When you write out a monthly budget of your primary financial needs, do you include money to be stashed away for savings or a rainy-day fund? If not, you might think again about calling “extra” money “discretionary” when you have no savings.

How much do you need to save for unexpected and future expenses such as retirement? It all depends on what you really need to live. The people who maintain high standards of living in luxury will require significantly more money in savings and retirement, than do those who live conservatively. One budget does not fit everyone, but there are a few guidelines, including how much money you might consider spending on your housing, for example.

Tips on budgeting and creating saving habits

In the article, How to Budget Your Money With the 50/20/30 Guideline, there are tips and examples of budgets that consider your goals and help you get ahead.

Habits and reinforcers, are they key to many smart personal savings plans. Just as we form habits of getting our coffee from our own machine or at a coffee shop on the way to work, we can form habits of stashing money away instead of spending to get a reward. When we spend money buying things and consuming we trigger the reward center in our brain. What if instead of instant rewards, we look closer into the reward of instantly increasing our power to buy something in the future?

Spend money investing in yourself. We all get bored and may want a distraction from time to time. These are the moments when we spend money doing something to entertain ourselves or take our minds of other things. Instead of running out and spending money on something you don’t need, spend the same amount on yourself by putting that money into a savings account. The next time you want to spend some money and earn a reward, take a drive to the bank and deposit some more money to your savings account. Your teller receipt will keep showing your growing balance.

Reinforcing positive spending habits and being proud of yourself

Ask yourself, would you rather have that money building in your savings or the other thing or activity you would have spent the money on? Even if you only save money every other time you want to spend money, you may choose to save more often than you spend.

As you continue finding little ways to save more money here and there you can watch your savings continue increasing, and that gives you the same reward sensation as buying or consuming something you like. Just as you can plant a garden, watch it grow and enjoy its benefits, you may feel very protective and proud of that money you were able to save.

Next, ask yourself how you can find some more money in your budget to add to your savings. By spending a little time and energy you can negotiate reduced rates for your household and utility bills – there may be easily be $100 or more you can find to save by simply reducing your monthly bills. As you continue finding more ways to cut spending and increase savings, you are reinforcing good habits and giving yourself a greater reward.

Spending and saving money are habits and after a bankruptcy, you can create some fantastic new habits that can lead you directly to financial success!

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Steps to a new home after bankruptcy

Yes, you can get a new mortgage loan or refinance after bankruptcy but it will take some patience and planning. Most lenders suggest you wait at least two to three or sometimes four years after your bankruptcy discharge to get into a new home loan. There are several options for post-bankruptcy home buyers such as FHA and VA loans, USDA loans and conventional loans.

FHA and VA loans are available two years after the date of a Chapter 7 discharge or after 12 months of timely payments on a Chapter 13 bankruptcy. Bankruptcy court approval is necessary to get the loan and you must explain the bankruptcy in the process. USDA loans require a three-year wait from a Chapter 7 and the same 12 months of timely Chapter 13 payments, with court approval. The conventional loans are four and two year waiting periods after Chapter 7 and 13 respectively.

Use the waiting time to get your new financial habits and savings in order.

Right after bankruptcy you may feel like the pressure is off and there may be disposable income for the first time in a while. Of course, there is a tendency to want to spend that extra money on the things you could not buy or do when under financial pressure before bankruptcy. Go ahead and splurge for a little while then pull in the purse strings and prepare to get credit worthy.

Take steps to establish your good credit habits. Start with a budget of all fixed monthly expenses and make a plan for how income will be spent every month. The most important thing you can do after a bankruptcy is not to get into any new unnecessary debt. It can take time to get used to living without things you do not really need and you may learn to really appreciate not feeling the stress of needing so many extras. Even buying more groceries and cooking from home instead of eating out is a habit that can save lots of money for future uses.

Money saving habits are contagious and good habits tend to spread.

Saving money is a habit, and it can be tough to learn. An easy way to save is to tuck money way automatically without being able to spend it. Open a savings account at your bank or credit union and set up an automatic online transfer of some amount of money to pull from your checking account right on or after payday deposits. You can also go to your human resources department to find out how easy an automatic withholding can be taken from your paycheck and directed to your savings.

Saving money and watching it grow is rewarding. When you start seeing lower interest rates, frequently paid bills and savings growing you may just keep trimming expenses and taking steps to increase income and savings. The fruits of our efforts help keep us motivated to be financially successful. In addition to saving money and avoiding further debt, credit management is necessary because you will need to qualify for a new mortgage like anyone else.

Joseph Wrobel, Ltd. helps people get control of their finances and a fresh start at financial freedom. The firm’s website contains informative videos about financial issues as well as bankruptcy protection for families who want a fresh start. To keep in touch and read about consumer finance news and stories you can Like the firm’sFacebook page and Follow Joseph Wrobel. Ltd. onTwitter. If you need immediate legal assistance, please call Joseph Wrobel, Ltd. by dialing (312) 781-0996 to talk to an attorney.