New here...tell me what to expect

[jhy12]

Hello everyone! In the process of filing for bk ch 13 in MN. Any tips/advice? We have about $90k in credit card debt...years in the making. Terribly ashamed- mostly my fault. I'm going to DA meetings (as well as my husband) to try to understand and work through that issue. I've got major anxiety and depression due to this whole issue. I should have done this 2 years ago really. My husband also has student loans- 1 federal, 1 private. Rolling both in but his father will be paying the private due to being a cosigner and they are really not easy to work with (already said they will just default if we miss one payment and won't defer). We'll pay him when we get out. Current on mortgage and car lease (although that's coming up in March). Needing to protect my assets as best I can to try to keep things as stable as possible for my daughter (she's 2). Terrible decisions on my part led to this situation and it's ripping me apart of what I've done to my daughter and husband. Something I've struggled with a long time and finally came clean about a month ago. We looked into debt settlement (National Debt Relief) and debt management programs (Lutheran Social Services) and tried Dave Ramsey snowball but none of those worked.
I'm mostly nervous about what to expect. Can we survive on a budget? Tbh, we never really worked with a budget (something both my husband and I will work on going forward). Any advice would be great. What type of things do they allow in your budget and about how much should I put in for? We have a 2 year old, a dog, a townhome, two cars (one own, one leased) and healthy (minus the depression/anxiety). Thanks!

[dmc-2008]

Tips & Advice? Expect the best, plan for the worst. Budget. Although I tried, I still live paycheck to paycheck. Its not easy. You will be fine if you watch your spending and keep your eye on your goal. Your kid is 2! Not even aware! Having teen kids is the challenge, cars and sports! Consider yourself lucky and change your habits. You can do this!

[dmc-2008]

Oh and get an RX for xanax, you will need it! Lol

[LadyInTheRed]

First, stop beating yourself up for the mistakes you have made. Look forward to working hard to avoid repeating those mistakes. The credit counseling course you must take before you file BK and Financial Management Course you must take after filing, will include helping you make a budget. Take the classes seriously and get the most out of it you can.

I agree that your daughter is too young to notice anything right now, except perhaps your stress and anxiety that should be at least reduced by filing BK. As she starts getting to an age where she will be more aware of money and buying things, you will be well into your BK and hopefully developing good habits. Chap 13 forces you to learn to better manage your finances. You can take what you learn to help your daughter learn about managing money too. Do some research about teaching children about money. One suggestion I have heard for very young children is to discuss purchasing decisions when they are with you on a shopping trip. Talk about the cost of one thing in comparison to another and the pros and cons of choosing a less expensive option. Discuss whether an item is something that you need or want. If it is a want, then discuss what other things could be purchased or saved for, if you don't buy that item. When your daughter receives money as gifts or starts earning her own money, make a rule that she must save a certain portion it and then let her decide how to spend the rest. Discuss her spending decisions with her before she makes them, but let them be her decisions. Maybe even discuss later whether she thinks she made the right decision. If she decides she made the wrong decision, help her learn from it instead of feeling bad about it. You will giving her a great gift by starting her financial education early.

The expenses allowed when calculating a Chap 13 payments are reasonable expenses necessary to support your household. There is no magic number. It depends on your income and your actual expenses. Many expenses will need to be close to local or national standards used on the means test. But, if your expenses are higher and reasonable, you just need to be able to show that they are. You will work with your attorney on your budget. Make a list of all of your expenses, including ones that only occur once or twice a year and give it to your attorney. Don't leave anything out and don't try to determine what is and is not reasonable. If there are necessary expenses that you have been holding back on while struggling to pay debt, list those as well. Your attorney should help you make any adjustments to your budget to avoid objections by the trustee. For example, some trustees do not consider pet care expenses as necessary. So, dog food and other supplies may need to be included in your grocery budget.

During your Chap 13, be sure to save money each month for the expenses that occur once or twice a year. Then, try to spend less than your budget on your daily,weekly and monthly expenses. Whatever is left at the end of the month should go to savings to pay for unexpected expenses, like an emergency vet bill.

Discuss with your attorney whether you should terminate that car lease now and buy a car before you file. Getting a new lease in the middle of BK may be difficult. It is best to make sure that your transportation needs for the next 5 years are covered before you file.

I'm assuming you are already working with an attorney. If you aren't, consult with at least 2 or 3 before you decide on one.

[zizzled]

Hello everyone... I am also just beginning jhy12... I've been told by 2 different attorneys that I will need to file a Chapter 13. The fist attorney, did no number crunching and the consultation literally took 30 minutes total. The second one did a bit of number crunching but didn't seem... I don't know how to describe it... just not sure if he would be a good fit for me. So, I'm trying to schedule another appointment with a different attorney to get as much of a baseline to choose from as possible. I have sooooooo many questions! Like, I'm engaged to be married and wondering if my Chapter 13 should be filed before I marry or after as I don't really want to impact my fiancee's finances, although he knows about everything! But, we live in Louisiana which is a community property state and I just don't know how that will affect us. In addition, I have 2 Lending Club loans and I'm a bit nervous about their aggressive collection once I stop paying them, which will begin next week. I guess, just overall, i don't know what to expect to be honest. I probably will be asking all of these questions to the next attorney that I meet with, but they are just some of the ones I could think of now... This forum has been super helpful already! I've found so many answers to my questions just by searching. This is my first, real post, though. I was considering waiting to file until i absolutely had to... is this too risky, I wonder? Anyway, thanks for your post... I always say, the beginning is a good place to start! You've begun, and so have I.

[LadyInTheRed]

zizzled , please start a new thread to ask your questions. It is confusing to address different issues in the same thread.

[bobcat216]

Like the Lady in Red said. Do not beat yourself yup. The best thing you can do for you and your family is to get your financial health in order. And the fact that you are in good health is a huge bonus that most people overlook. You may have to live with your tail between your legs for a bit but know that "even this shall pass". Know you have the resolve to conquer this as many of us here have gone through this and you can too.

Don't hesitate to post questions.

Budget budget budget

I use https://www.mint.com/. It ties directly to my bank accounts and lets me know exactly what and where money is getting spent.