credit card

Many people are reluctant to seek bankruptcy protection because they are concerned about the impact it will have on their credit record. Unfortunately, there’s no way around this consequence. A bankruptcy filing will hurt your credit score. But if you’re already struggling with debt and are behind on your bills, you’re already experiencing a negative effect on your credit.

A bankruptcy filing enables you to get relief from your overwhelming debt. Once you’ve addressed your current financial problems, you can start to rebuild your credit. The road to a better credit score may not be as difficult as you think.

Small steps

Once most or all of your debt has been discharged through bankruptcy, you’re not going to turn around and apply for a black card with an unlimited line of credit. In fact, you may not qualify for any type of credit card at all. Don’t despair. There are other steps you can take.

You should consider getting a debit card that’s tied to your checking or savings account. This will help ensure that you don’t start spending beyond your means. Keep track of your finances and make small purchases.

Once you’ve been using a debit card for a while, you may be able to apply for a credit card. It’s likely any offer will come with a low credit limit and a high interest rate. However, this shouldn’t concern you too terribly. One of the best ways to build up your credit score is to pay off your statement in full and on time every month. Doing so will help you avoid the financial hit of an absurd interest rate. This approach will also help you stay within your financial means.

Continue to use your credit card strategically and in a couple of years you will start to see a major improvement in your credit score. Remember, if you’re already in debt, you aren’t doing your credit any favors. Delaying the inevitable will only prolong the damage.