Almost Three Years

It's been almost three years since we were discharged. Adjusting to living on a cash basis has been difficult, but it is the smart way to go, for sure. We have slowly been repairing our credit, though. One year and two years are the marks to meet in order to be 'eligible' for much of any credit. Our bank, for instance, required that we be have at least a year between us and the discharge before we apply for any sort of credit. Other credit outlets seem to look at you more favorably after the two-year mark. I know what you're thinking! They just got out of bankruptcy, so why the talk about applying for credit!? I agree, it sounds crazy, but there are certain situations that come along and you find yourself stuck and in need of help. Especially still this close to discharge, which hasn't allowed much time to save amidst other financial emergencies. Dave Ramsey always mentions Murphy's Law, and he couldn't be more correct - more recently, the day after we built our emergency fund back up, a car repair popped the fund and depleted everything. We are still trying to build the emergency fund back up.

We probably haven't gone about this bankruptcy recovery thing correctly, but we are managing as best we know how. With a family as large as ours, the expenses are never-ending, so opportunities to save seem so few and far between. And some credit decisions were made in haste, or without proper regard for the bankruptcy recovery. For instance, a purely elective medical procedure that wasn't 100% necessary, but was something that had been on the table for MANY years. Instead of saving, it was financed over a certain amount of months. And there are two credit cards that were applied for just out of curiosity to see if the answer would be YES or NO. The shock came when the answer was YES. Those cards are unused 95% of the time, and primarily have zero balances, since they are retailer cards (think clothes and very small credit limits) rather than general VISA, MASTERCARD, DISCOVER, etc, with which you can buy anything and everything (and get yourself into a load of financial trouble).

My main point here in talking about credit is that all hope is not lost after bankruptcy! You do not have to live a destitute life forever... in my experience, it is the first two years that are the most difficult, because you truly have no resources except yourself. It is all cash the first two years, so having emergency funds is imperative. Once you can get past the first two years, the belt loosens and you can breathe.

But, I accept that any reliance on credit is not a healthy standpoint for someone coming out of bankruptcy. We are well aware of the dangers, and know that is not a road we want to travel ever again. Bankruptcy recovery has been difficult enough!

In the same way that a life of debt was somewhat suffocating and stifling, a life lived on a cash basis is equally as constricting. The main difference is that it is easier to deal with living WITHIN your means than to deal with living BEYOND your means. Not knowing how you are going to pay your debts is entirely different than knowing you have to be extra frugal because you don't have any other choice.