Life After Debt: Moving Forward – Financially and Emotionally

Congratulations! Now that your Bankruptcy or Consumer Proposal is completed, you are in the next phase of taking control of your finances.

Without debt, you now have the freedom and opportunity to make financial decisions based solely on your goals — not your obligations to creditors. Your money is completely in your control and so are the choices when it comes to your finances.

How do you handle this fresh financial start and avoid falling back into old patterns of incurring debt?

Change Your Thinking

The way we habitually do anything can be difficult to readjust. But what would it feel like to handle money differently?

For example, how would it feel to save $1,000 as the start of an emergency fund? If you choose to have a credit card again, how would it feel to be able to pay it off in full each month?

When you no longer have debt, you can direct your money in much different ways. You can save for what you want, rather than impulse buying on credit. You can relax when your paycheque comes in, knowing you’ve still got money in the bank and don’t have to scramble to make ends meet.

It is possible; but before changing your thinking, you need to change what you’re feeding your mind.

Change Your Self-Talk

You can’t change your thinking if you’re feeding yourself the same old messages:

“I’m broke.”

“I don’t have the money to go to the dentist / get new glasses / visit the chiropractor.”

“I can’t afford to buy life insurance or contribute to my company pension plan.”

Do any of these internal monologues sound familiar? This type of self-talk fosters a feeling of deficiency. If you’ve convinced yourself you can’t afford important things, it prevents you from even considering whether you can.

To determine whether this is something you are doing, track your spending for a month or two. You may see meaningless spending patterns and discover opportunities to redirect your money. Allocating funds to more important things will help you stop spending mindlessly.

Change Your Budget

Do you earn a good income but find it difficult to change your thinking patterns?

Simply meeting with a financial consultant or a financial coach who can look at your finances and provide a different viewpoint could be enough for you to see what is possible. A financial consultant or a financial coach can also refer you to investment options, proper insurance, estate planning resources and setting up financial goals. 

When you adopt a new perspective, you may see that what felt out of reach before bankruptcy can now easily fit into your monthly budget.

Change Your Financial Future

Sadly, for many people bankruptcy is not a one-time event.

Despite their best efforts, bankruptcy filers often file again because they have not changed how they handle their finances. They may be struggling with deep emotional issues about money.

Even though your finances are in better shape now, it’s important to be aware of any old financial habits that may be sneaking back in. It could be that you don’t have adequate strategies to cope with the emotions or stress around managing money. And without getting to the root of the problem, you could enter a cycle of emotional spending which can cause debt — bringing stress, heightening negative emotions and possibly leading to more spending and debt.

If you are struggling with this type of financial and emotional roller coaster, we encourage you to explore your options because help is available. There are many resources available online to help you understand your relationship to money, so you can make long lasting changes to how you think about and handle money — and change your financial future for the better.