Going through bankruptcy isn't easy on anyone, so it's a matter best handled through prevention. Whether you're struggling to make ends meet or aiming to get ahead financially, these top financial tips from a chapter 7 lawyer can help you stay solvent and on track.

1. Live Within Your Means

If your income isn't sufficient to cover all your expenses, take a hard look at all the areas in which you could cut back. Ensure you're only spending money on essentials and not bloating your budget with unnecessary purchases. Living within your means is one of the best ways to avoid bankruptcy.

2. Budget Carefully

Creating a budget and tracking your spending will help you stay on top of your finances. Account for all of your expenses, including fixed costs such as rent and utilities, as well as variable ones like groceries. This budget will help you manage your money more effectively so you don't end up in debt.

3. Be Smart With Credit Card Usage

Any chapter 7 lawyer will tell you to be mindful and responsible when using credit cards. Understand the terms of your card before making any purchases and make timely payments on your bills to avoid interest. Also, try to limit yourself to using only one or two credit cards with low-interest rates so you don't end up in over your head.

4. Stick to the Plan

Once you've created a budget, do your best to stick to it. That means not spending more than you can afford or using your credit cards for things like dining out and vacations instead of saving money. You can even keep your credit cards at home to avoid using them if that helps.

5. Consider Filing for Bankruptcy

If you find yourself in a situation where your debt is unmanageable, it may be time to consider filing for bankruptcy. Although it's not ideal and can have long-term financial repercussions, it's sometimes the only way to get out of a financial hole. Be sure to consult with a chapter 7 lawyer before moving forward.

No one likes to think about bankruptcy, but unfortunately, it's an option that some people have to consider. According to a Boston College study, only 5% of bankruptcies are attributed to reckless spending. The vast majority are cases of financial hardship. That said, taking smart financial steps, such as sticking to a budget and living within your means, are all beneficial ways of avoiding this situation. Contact Chris Carouthers & Associates today for more information.