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Navigating Post-Bankruptcy Financial Planning: A Guide from a Bankruptcy Attorney

May 9, 2023 Scura Law Firm

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Filing for bankruptcy is often a difficult but necessary decision to regain control of your financial life. It provides individuals and businesses with a fresh start by either eliminating or reorganizing their debts. However, believing that your financial recovery process ends with a bankruptcy discharge is not realistic – especially if you want to learn from your bankruptcy experience. Therefore, your post-bankruptcy financial planning is crucial to ensure a solid foundation for your financial future. This blog, we'll explore key steps and strategies to help you navigate the path to financial recovery after bankruptcy.

Assess your Financial Situation:

After bankruptcy, it's essential to conduct a comprehensive assessment of your financial situation. Start by outlining all of your household income, necessary living expenses, and other fixed debt or obligations that may have not been eliminated in the bankruptcy (i.e. rent, mortgage or car payment). This evaluation will give you a clear understanding of your financial capabilities and limitations, helping you set realistic goals and allowing you to take control of your finances.

Create a Realistic Budget and Sticking to It:

Now that you understand how much income you make and what debts need to be paid every single month – develop a budget. Developing a budget is crucial to manage your finances effectively. Assess your income and prioritize essential expenses while cutting back on non-essential ones. Track your spending regularly and make adjustments as necessary to stay on track with your financial goals.

Emphasize your Focus on Long-term Financial Goals:

Ok – you have a budget, but do you have financial goals? Post-bankruptcy financial planning should also include setting long-term goals because – after all – bankruptcy is a means to an end, not the end itself. Since there is a lot of misinformation about bankruptcy, most don’t set long term financial goals post-bankruptcy because they often assume that they are seen as a “financial pariah.” This is far from the truth. The purpose of bankruptcy is a financial “fresh start” where the ultimate consequence is a clean financial slate and a re-shift in focus from paying back debt to your long term financial goals. Whether it's saving for retirement, purchasing a home, or funding your children's education, having clear objectives will give you direction and motivation. Break down these goals into smaller, achievable milestones to stay motivated along the way.

Establish an Emergency Fund:

Building an emergency fund should be a priority, especially after bankruptcy. Unfortunately, very few people save for emergencies and must rely on credit to cover emergency expenses which, if you’ve been down this path before, can be a very slippery slope. Next thing you know, all of these minor emergencies have all added up to several thousands of dollars being charged to a credit card. Aim to save three to six months' worth of living expenses to provide a cushion against unexpected financial setbacks. This fund will help you avoid relying on credit cards or taking on new debts when faced with emergencies.

Rebuild your credit:

Although bankruptcy does have an impact on your credit score, this does not mean that you will not be able to build credit after bankruptcy. In fact, not only is it possible to rebuild your credit after bankruptcy, it is recommended that you do. First, check your credit report often to make sure all of the information is accurate. If you find any errors, you can dispute them with the credit bureau. Second, pay all of your bills on time, every time. If you’re having trouble remembering to pay your bills on time, you can set up automatic payments or use a calendar to help you keep track. Third, get a secured credit card from your bank. A secured credit card is a type of credit card that requires a security deposit, which becomes your credit limit. By using a secured credit card responsibly, you can rebuild your credit and eventually graduate to a traditional credit card. Lastly, avoid applying for too much new credit at once. If you have no choice and need to apply for credit, try to choose a company that will qualify you based on a “soft inquiry” that has little to no impact on your credit score.

Seek Professional Financial Advice:

Consider consulting with a financial advisor who specializes in post-bankruptcy planning. They can provide personalized guidance and help you develop a long-term financial strategy tailored to your specific goals and circumstances. Furthermore, if you’re having trouble fixing your credit on your own, you may want to consider working with a credit repair company. These companies can help you dispute errors on your credit report and negotiate with creditors to remove negative information. However, it’s important to do your research and choose a reputable company. There are many scams out there, so be sure to check with the Better Business Bureau and read reviews before choosing a credit repair company.

Continue to Educate Yourself:

Financial literacy is key to long-term financial success. Read books, attend seminars, and stay informed about personal finance topics. This knowledge will empower you to make informed decisions and avoid common financial pitfalls in the future. Here is a list of resources that can help you with your financial planning post-bankruptcy:



Navigating post-bankruptcy financial planning requires careful consideration and strategic decision-making. By assessing your financial situation, establishing an emergency fund, rebuilding your credit, seeking professional advice, and setting realistic goals, you can take control of your financial future. Remember, the path to financial recovery may take time, but with discipline, determination, and sound planning, you can rebuild your financial life and achieve long-term stability. We are well qualified as a full-service law firm for people in this county and other New Jersey counties: Passaic County, Hudson County, Essex County, Bergen County, Morris County, Union County, and Sussex County. If you need assistance, call us today at 973-554-9827 or toll free 973-696-8391.


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