4 Ways To Recover After Becoming Debt Free - Bolinske Law
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4 Ways To Recover After Becoming Debt Free

4 Ways To Recover After Becoming Debt Free

So the mountain of debt you told yourself you’d never get paid off is finally eliminated. What do you do now? Becoming debt free can be a great feeling.

After telling yourself for so long it wasn’t going to happen, and pushing yourself forward even on days when it felt useless, you’ve finally made it.

Here are 4 ways to manage debt after becoming debt free to ensure you don’t fall back into your old habits and start gathering debt again.


The good thing about changing habits is you probably changed your spending habits to accommodate your monthly debt payments. This is a great start but if you let these new habits get away from you you’ll be right back where you started.

If you didn’t have to time to change your spending habits, due to filing for a Chapter 7 bankruptcy, then now is a great time to start. You’ll still have a mortgage and an auto payment if you had those before but the rest of your income can go to savings.

Building your savings will help you avoid being thrown into a tight spot financially and not being able to get out.


Debt Recovery

If you created a budget to pay off your debt, stick to it. Once your debt is gone your going to have more free cash than you did before. It’s important you don’t spend it on useless items. You’ll need to mark a savings spot in your budget and make sure part of your monthly cash flow is directed towards this. Spending your money on useless items is a sure way to make sure you won’t have the money when you really need it.

If you didn’t get a chance to create a budget while paying off your debt now is as great a time as ever. Build your budget around your monthly income and expenses. See what you can and can’t spend and exactly what you’ll need to put away for emergencies. There are many free pieces of budgeting software out there that make budget tracking a breeze.

Try one today and see exactly where you money is going.


Having money in savings is important to helping you avoid being put back into debt again. You never know when something crazy might happen in your life. Whether it’s damage to your home, an illness in a loved one, or your car simply gives out. All these things can set you back after paying off your debt. If you have a strong savings the damage won’t be quite as bad.

Some people like to have 6 months of income in their savings at all times, but 1 to 3 months will do just fine to start out. The key to keeping your savings account full is thinking before you spend and keeping track of your money. If you want to make a large purchase save up for it instead of immediately dropping cash on it or using a credit card.

Waiting before you spend will also help you realize if you really need it or not. Family vacations are great to save for and you can usually get a better deal if you start paying a year or so in advance.


Changing your mindset about debt is going to be the hardest thing to master. You’re going to have to stop yourself before making purchases. The good thing about being in a ton of debt is that it’s good motivation to never want to be in that situation again. Once you pay your mountain of debt off the last thing you’re going to want to do is rack up a bunch of credit cards.

In time this motivation to be debt free will start to fade and you might be tempted to allow debt back in your life. You just have to make sure it’s worth it and you won’t regret it. Developing a plan to pay debt off before you accumulate is key to better money management.

You’ll find now that you are out of debt a friend or family member, who may still be struggling, might be jealous or try to make you feel bad. Keep your mindset positive and don’t let anyone persuade you into thinking you need debt to keep going. The best thing you can do is to pay it forward. Try sharing what worked for you with them.

Being debt free is going to be a weird feeling at first. It’s going to take some time to get used to not having that huge weight on your shoulders. Be happy and celebrate, and make sure you never have to end up there again.

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