Filing for bankruptcy? Improve your credit score instead! Here’s how



Life has it’s ups and downs, and we all get through some form of financial trouble. Sometimes, it can be so challenging that you might want to consider filing for bankruptcy. Still, there are other options available to you that can be a good solution for your needs. We’ll provide a short guide to help you out in this article, and cover things such as credit card debt, tax check, credit score check, back taxes, and how to fix credit history along the way.

Why not file for bankruptcy?

Filing for bankruptcy can easily sound like a way out. However, that is not the case. If your debt is in the form of back taxes (you can conduct a quick tax check to find out), you won’t get rid of it anyway. Bankruptcy will also quickly make your credit score fall (you can conduct a quick credit score check to find out yours), and it can make it hard for you to fix credit history. Lastly, you may not need to file for bankruptcy since you might be expecting payments very soon! Here are some ways to avoid needing to file for bankruptcy and improving the credit score instead.

Spend on what you need, not on what you want

It can be hard to do this part right. We all have desires, and if we have had ample cash in the past, they can be pretty menacing. But as attractive as that new shade of lipstick might be, do you really need it?

If anything is not absolutely essential for your survival, it is time to cut back. You’re currently under looming debt in the form of back taxes or credit card debt that needs to be paid off, and you should thus only spend when you absolutely need to.
If you can control your spending instincts, you’ll have a lot more money freely available with you to return the back taxes and credit card debts!

Pay the back taxes and credit card debt first

Most debts for a person would be in the form of obligations from people. While those should be repaid promptly as well, there are some forms of debt that typically have very high-interest rates on them, which means that if they are left hanging, you would be accumulating debt quicker than you can pay it off.
Back taxes (You should always go through a quick tax check to find how much is unpaid) and credit card debts also typically impact your score the most, which means that by paying them off quickly, you may be able to regain your credit score, and it’s smooth sailing from there!

Why is a good credit score important?

A good credit score tells people you deal with that you are going to return the loan amounts. (You can run a quick credit score check to find out yours) If you are near bankruptcy and in need of money, this can be supremely beneficial for you. This is because you can get more loans to repay off the old ones.
What this would do would be further enhancing your credit score. You would not have delayed the repayment dates by too much. This is especially helpful if you are going to be able to start earning soon because then you can quickly settle off the new debt that you would have taken as well!

What if I expect no money soon?

There can be cases where you might expect no money anytime soon. Maybe because you are unemployed or your business is running in a loss.

If you are unemployed, you should find jobs. You can try moving around (i.e., going to another city) to find excellent opportunities. 

If you are having trouble recouping your business, you can try new innovative advertising or methods. Alternatively, you could shift industries or simply call quits and liquidate the assets to get money back. It is better invested elsewhere if your business is dead, anyway!


If you want to fix credit history and avoid bankruptcy, it’s never going to be easy. But knowing that you managed to save yourself from bankruptcy, corrected your credit scores, and are now en-route growth is definitely rewarding! You should always try to fix your finances before ruining the credit score, and we hope that this guide showed you exactly how to!


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