Once you file for bankruptcy, you have drawn a line in the sand between your past – your unmanageable debts – and your future.
You are protected from liabilities up to the date you obtain a Bankruptcy Number, but any debts acquired after that are your responsibility.
To rebuild your financial health once you have the protection of bankruptcy, we recommend you prepare a budget and manage your finances accordingly. Make sure it is simple and easy to follow.
We have seen budgets that are works of art, but they end up stuck on the fridge collecting dust. Yours needs to be user friendly, to make your life easier.
First up, work out your living costs for your pay cycle. You may be paid weekly, fortnightly or monthly, but calculate what you need to pay on a weekly basis for the absolute necessities of life. Consider your rent, electricity, gas, car registration and insurance, car maintenance, road tolls etc.
The total amount for these ongoing costs should be separated from your pay. That way, what is left is for your food, clothes, entertainment and personal care. If you want to take it to the next level, you could then do a separate budget for those items.
Try putting your budget into practice as follows:
- Identify all your expenses and estimate their weekly cost.
- Set up automatic payments for those expenses from your bank account for the day after your pay is due to go in. If you check your bills, you will see a biller code and reference number. Use these to set up automatic BPAY payments (there will be an option in your account to set these payments to regular cycle) or there may be bank account and BSB numbers you can use under Future Payments.
- Fill your car with petrol.
- Buy your groceries.
- Pay for any other necessities (medications and the like).
- Whatever is left is yours to spend – or, better still, to save.
If you budget well, you will have the money to pay your bills as they come in and this should give you a better quality of life.
Any questions? Call the Nicholls & Co help desk on 1300 060 122.