I Went From Bankruptcy to Saving Six Figures: 5 Ways I Rebounded and You Can Too

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According to data shared by the Administrative Office of the U.S. Courts, individual bankruptcy filings reached 542,529 cases, with an increase of 11.5% for the 12-month period ending on June 30, 2025. Based on internal data from Bank of America, 24% of Americans are living paycheck to paycheck. It’s evident that Americans are struggling with their finances as the cost of living has gone up, and many have been forced to make difficult decisions.

GOBankingRates spoke with someone who went from filing for bankruptcy to eventually becoming so successful that they had six figures in savings. Carlos Scarpero, a mortgage broker and the founder of Scarpero.com, shared that he filed for bankruptcy in 2012 when his business failed, and he had to deal with cancer. It took him some time to rebuild his finances, but now he has over six figures in savings and is in a much better position. 

These are the steps that Scarpero took after he filed for bankruptcy and decided it was time to get out of dire financial straits. 

Step 1: Find Coaching To Help You Figure Out Where To Start

Scarpero recommended finding some form of coaching to help you figure out what you should be working on. He acknowledged that you likely won’t have the financial resources when you file for bankruptcy, so you’ll want to find whatever is available to you for free. “Sometimes, when someone is broke, free coaching is the way to go. As they make more money, they should upgrade to reliable paid programs,” he said.

He credits personal development coaching and training with helping him tremendously. While one may not always be able to afford coaching or advice, one can start by exploring free counseling options. For example, the Federal Trade Commission has a list of resources and options for those who are struggling and unsure about how to proceed.

Step 2: Find Ways To Increase Your Income  

“I think it’s really hard to break out of a financial rut on a salaried income,” Scarpero said. He pointed out that self-employment or commission-based work has much more upside. He changed careers in 2017, leaving the online marketing space to enter the mortgage industry. He earned six figures in 2021, but his income dipped in the next few years. However, 2025 has been his best year by far because he has become more focused on the Veterans Affairs home loan market. He shared that he has already earned over $200,000 in income this year. 

One of the best things you can do for your finances is find ways to increase your income. While you may not always have the opportunity to return to school, you can explore programs and options that fit your budget. There are also various industries that offer decent salaries without a college degree.

If you’re in a similar situation, it’s highly recommended that you look into ways to boost your income so that you can get aggressive about paying down debt and saving for the future. 

Step 3: Avoid Lifestyle Creep

Scarpero recommended avoiding lifestyle creep as much as possible. He used his pay raises and bonuses to boost his savings rather than treat himself.

It can be tempting to use any extra money to reward yourself, but Scarpero advised that you practice delayed gratification by making your finances a priority until you’re comfortable with your savings. You may want to start by eliminating any subscriptions that don’t fit your budget, then look for low-cost entertainment options to save more of your money. 

Step 4: Look For Big Financial Wins

When rebounding to six figures in savings, Scarpero acknowledged that he had some fun financial windfalls along the way. For example, he made a profit of $110,000 when he sold his home and moved to a different property. It’s important that you look for financial wins to help you build momentum and stay focused. 

As for the six figures in savings, some of it has come from 401(k) and IRA contributions. In addition to his other savings, he has over $60,000 in his retirement accounts, while his wife has around $175,000. 

Step 5: Accept That It Will Take Time 

Scarpero admitted that it took a long time to get back on his feet after filing for bankruptcy back in 2012. He felt it took him 10 years to rebound and build a six-figure savings. It’s worth pointing out that accumulating debt can take years, so don’t expect to pay it off in just a few months.

Building your savings to six figures may take many years and require sacrifices. However, it will all be worth it when you’re in a position where you’re financially comfortable and able to live on your own terms. 

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