There seems to be a great deal of talk these days about rebuilding credit after bankruptcy.
However, I would suggest a better approach would be to build good credit before bankruptcy.
This article is going to examine some strategies for rebuilding credit for those living in the credit aftermath of bankruptcy as well as demonstrate good credit management practices that can help avoid bankruptcy.
Bankruptcy is nearly an epidemic in America.
And people start down this path unknowingly.
If consumers focused on good money management practices from the start, bankruptcy might be avoided all together.
The great thing is that good credit management practices can be implemented before bankruptcy as well as after.
Keep this in mind.
Bankers are not rooting for you to fail.
However, sometimes the goal to make a return on their investment is not helping your credit.
And when you allow others to set the agenda when it comes to your finances, you may be heading towards bankruptcy or at a minimum a poor credit score.
Bankruptcy Avoidance Strategies

1. Credit Cards - It goes without saying creditors make money by extending credit.
   They are counting on you maintaining a balance on your credit cards.
   However, this balance has an adverse effect on your credit score.
   Large credit card balances receive a negative sign when credit scores are calculated.
   A better practice would be to pay any outstanding bill at the end of each month.
   
2. Equity Loans - Creditors are willing to loan money to you based on the equity in your home.
   And it is very tempting to finance a room addition or family vacation with these easy loans.
   But they just add to your existing debt which negatively effects your credit score.
   The better practice is to avoid equity loans completely.
   Unfortunately, there are unforeseen events in our lives which may justify an equity loan.
   But for most people, this is an unwise financial move.
   
3. Short Term Loans - Creditors are known to push comfortable payments.
   They will suggest it is easier to manage a smaller payment for a large purchase like a car.
   But that payment extends the life of the loan.
   And it increases the amount of money paid to the creditor.
   Best practice would be to shorten the loan.
   The payment will be slightly larger.
   However, the sooner you pay off that debt, the sooner your credit score will go up.
   
4. Credit Score Benefits - Did you know creditors favor people with high credit scores? When a person maintains a high score, they are offered lower interest rates.
   This is an award system for those who have demonstrated wise money management practices.
   So when you handle credit wisely, not only does your credit score go up, but you save money through lower interest rates.
   

People need to drop the mindset of rebuilding credit.
The best practice is to build good credit from the start.
Regardless of your situation, it is never too late to begin healthy financial habits.
It requires commitment and discipline.
You can alter your financial picture by implementing these four credit strategies.
Acquiring credit health may not be quick; however, long-lasting things usually never are.