Will I Still be Able to Buy Things After I File for Bankruptcy?

Many people have questions about what life will be like after they have filed for bankruptcy.

It is often assumed that bankruptcy means losing everything, but this is not the case.

In fact, bankruptcy is a solution, which is designed to encourage and enable people who have experienced severe financial issues to recover and start afresh.

When you file for bankruptcy, there is an extensive list of exemptions, which helps to provide a foundation on which to build.

One of the most significant advantages of filing for bankruptcy is eliminating debts, which have been costing you money for a long period of time.

If you reach the point where you don’t have the means to cover bills and pay off outstanding debts, and you are advised to consider bankruptcy, your financial future could look a lot rosier than you anticipated.

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Your unsecured debts will be removed when you file for bankruptcy, and if you’re used to making substantial debt payments every month, you will soon find that you are able to start working towards saving.

If you consider an example scenario where you’ve been paying off credit cards or other unsecured lines of credit, you may have been paying hundreds of dollars towards debts each month.

Once you have filed for bankruptcy, you won’t have to cover these monthly instalments anymore, freeing up cash to spend and save.

With the money you earn and put aside, you can buy new things or set up a fund for retirement, college, special occasions or home improvements.

If you were paying $700 per month in debt repayment, for example, you could save $8,400 per year, and this will make a huge difference.

Controlling spending and managing money

One of the main reasons people find themselves in a situation where they can’t afford to pay their bills is a tendency to overspend.

If you spend more than you earn, and there’s a shortfall, you may be tempted to borrow money, which you might not be able to pay back.

If you’re using credit cards, or you’re taking out payday loans, the interest charges will soon add up and your debts could snowball quickly.

After filing for bankruptcy, it’s essential to make use of the information and tools provided by credit counsellors and licensed insolvency trustees to manage your money and control spending.

We live in a society where buying and treating ourselves is actively encouraged, and there is a temptation to buy now and think about how you’re going to pay it back later.

In Canada, the average household owes $1.78 for every $1 earned, and in 2019, there was an increase of almost 20% in the number of people filing for insolvency.

Budgeting is an incredibly effective means of regulating spending and keeping a close eye on your finances.

If you draw up a monthly budget, you can set weekly spending limits, transfer money to a savings account and identify areas where you could make cutbacks if you want to tighten your belt.

It’s also essential to check your balances and statements on a regular basis and to update your budget as you go.

Today, it’s all too easy to lose track of where your money goes as a result of contactless payments, direct debits and online shopping.

Creating a financial plan is also advantageous.

If you can work towards a savings target, for example, this will motivate you and help you maintain a firm grip on spending and saving.

Signs of overspending

In 2019, Canadians had an average non-mortgage debt of $23,800, according to Equifax.

It can be very difficult to resist or control urges to spend money when you are bombarded by adverts and offers.

If you do start to notice that you’re spending more, or there’s a risk of getting into debt, it’s wise to act swiftly to reduce the risk of debts spiralling and losing control.

Some red flag signs to look out for include:


  • Buying things you don’t need or even want.
  • Feeling like you need to make a purchase to cheer yourself up or make yourself feel better.
  • Neglecting bills.
  • Being surprised by credit card bills and assuming your bank balance would be higher than it is.
  • Making minimum payments on your credit card.
  • Worrying about your cards being declined when you reach the register.
  • Other people commenting or complaining that you have spent too much money.


Tips to avoid overspending

If you’ve filed for bankruptcy, the last thing you want is to find yourself in a situation where you’re struggling with mounting debts again.

There is a lot of pressure to spend money, but if you’re making purchases you can’t afford, or you’re borrowing money, you run the risk of getting into trouble again.

Here are some tips to make it easier to live within your means:


  • Ask yourself whether you really need an item before you buy it.
  • Stick to your monthly budget.
  • Try and put money aside for a rainy day or an emergency.
  • Resist external pressures and focus on your individual savings goals. There will always be people who have more money than you, but the important thing is to make yourself and your family happy. Keeping up with the Jones’ can be a very costly exercise.
  • Take up hobbies to use your time constructively.
  • Pay off credit cards as and when you use them and consider them a last resort for one-off purchases.



Many people assume that going bankrupt means that you lose everything and it’ll take years to reach a point where you can buy things again.

In reality, bankruptcy is a solution that gives you a base on which to rebuild.

If you have any questions, or you’d like advice about filing for bankruptcy, our expert team is here to help.

Call us today to find out more!

Canadian Bankruptcies

How to File for Bankruptcy
What is Bankruptcy?
Bankruptcy FAQs
How Does Bankruptcy Work?
What is the Cost of Bankruptcy in Canada?
How to Rebuild Credit Following Bankruptcy
Personal Bankruptcy in Canada
What Debts are Erased in Bankruptcy?

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