Defeated. Embarrassed. Disappointed. Broken.
These are just a few of the emotions that were going through my mind the day we filed for Chapter 13 bankruptcy. But as the past 5 years have come and gone, I look back at my bankruptcy as a blessing.
A blessing? Something that basically takes away any credit options (car, mortgage, credit cards, school loans, even bank accounts!) and leaves a mark on your life for 7 years. It’s definitely been difficult and overwhelming at times, but at the end of the day, I am glad I’ve had to go through this.
It happened when I was previously married. We had one house that had gone into foreclosure after those that were renting the house didn’t renew the lease and we couldn’t find new renters. We had a new house (our dream house) and were barely surviving. We had credit card debt up to our ears. We’d get a new card with a 0% transfer rate and move money around the best we could to not have creditors hounding us. We tried to be as responsible as possible, even getting involved in debt counseling and payment plans (which ended up hurting us more than helping us).
We ran out of options and for us, filing for bankruptcy was the only thing that made sense to us. We filed for Chapter 13 Bankruptcy and started our 5 years of monthly payments. Thankfully, we were able to keep our house and our cars, which as a family with 2 small children and opposite working schedules, was a blessing.
Fast forward a couple of years. Now divorced, I had shared custody of my children, and struggled on a single mom’s income. I had car troubles, moving issues, apartment/home searching difficulties, and had to just go without for most things. I couldn’t have a “newer” car, I couldn’t get the new outfits at the stores, I couldn’t even open a bank account on my own. It’s been a difficult time, but through it all, I’ve learned so much, and in turn, have been able to teach my children some valuable life lessons!
You Don’t Buy What You Can’t Afford
This should be obvious, but in this day and age and the credit card industry overwhelming the airwaves and your shopping experiences, it’s easy to overlook. And when children are young and their parents give them things, they don’t understand this way of life. Without having the use of credit, this lesson has been difficult but very easy to follow! We, as a family, have learned about saving money, impulse buying (and the repercussions of it) as well as the satisfaction of paying for an item in full at the store.
Be Wise Spending
Since I don’t have the convenience of credit cards to buy more expensive items and paying them off as I can, I have become a bargain mama! I was already somewhat thrifty and always looked for great deals, but I stepped up that game after our bankruptcy. I use coupons when I can, I shop the clearance sections first, and I’ve become quite the DIY queen. Saving money and finding bargains is like a game to me now! I try to include my children in our money saving adventures, finding the best deal and making the most of thrift shopping trips. It’s become something fun for us now!
Budget, Plan, Implement
We have become much more budget minded these days. With increased school fees, sports involvement, vacations, and now my upcoming wedding, we have learned how to budget and plan to have everything paid in full and on time. We have learned to save and go without if needed in order to get the end product we desire.
For example, my wedding in May will be paid IN FULL before the wedding date. It will be paid IN CASH, with no credit balance. It will include several DIY projects that have saved me hundreds, if not thousands of dollars. You don’t have to spend a lot of money to have something nice. This will be the same with our honeymoon. We will be taking it later this year, and it will be paid for in full using wedding gifts and our honeymoon registry. Where we end up going will depend on how much we are given. We will begin our married life together, debt free. It’s a lesson my children will live through their lives as well!
Financial Freedom is Liberating!
I am happy to say that our bankruptcy is PAID IN FULL and we are now in the process of having it discharged. This means my mailbox will soon be flooded with credit card offers. This means I can get a car loan soon and we can take on a mortgage. Does this mean we will be doing this? NO! I intend to continue to live without the aid of credit cards. I will continue to save towards a goal and pay what I can afford. I have no desire to take on additional debt and I plan to have a large amount of emergency savings stashed away. I intend to live debt-free for the remainder of my days. Finding financial freedom is liberating and one of the best feelings.
Going through the trauma of filing for bankruptcy is something I don’t want to wish on anyone. It’s difficult and at times unbearably heart-wrenching knowing that I have very limited options in life. But when you’ve been through what seems to be an incredibly low valley, you can only go up. And that’s when you can truly see the clouds and all the silver linings they can contain!