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Managing holiday spending post-bankruptcy

You've filed for Chapter 7 bankruptcy and received a discharge. You probably feel a huge sense of relief, but that can be short-lived if you return immediately to the same financial habits that resulted in your debt crisis to begin with. It can be hard to change those habits as the holiday season swings into gear, though, because so many people overspend during these months and put gifts and other expenses on credit cards. Here are some tips to controlling your holiday budget.

First, know that you might have to cut back on spending. This doesn't necessarily mean you can't give any gifts, but you might have to reduce gift-giving or become adept at nabbing deals. You could sign up for review sites that let you order items from places such as Amazon for a deep discount, and you might haunt outlet stores to get as much as 2/3 off brand merchandise.

Whatever you buy, do it with cash. Just after bankruptcy, you might not have any credit accounts and if you do, you certainly don't want to run them up with holiday spending.

Cut back on pricey items that aren't necessary. Yes, lovely gift packaging can be fun, but you don't need to spend $10 to wrap each gift. Choose inexpensive wrapping or make your own at home with scrap fabric and paper you already have.

There are plenty of ways you can save money during the holidays to avoid falling back into debt after bankruptcy. If you're facing a debt crisis and haven't filed bankruptcy, one of the best gifts you can give yourself is a consultation with a professional to find out what your options for relief might be.

Source: FindLaw, "Holiday Budget Survival Guide," accessed Dec. 16, 2016

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Joshua Z. Goldblum, Attorney at Law
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