Anyone ever quit a job before filing?

[ylime]

One of our main concerns is that our disposable income is going to drastically change in December when we have to start paying daycare for our baby due in August. Currently our daughter's daycare expenses are $500/mo. Adding in the infant care we'll be at $1600/mo. My husband currently brings home $1800/mo.

We've been considering for some time having my husband quit his job and stay home to watch the kids, which would totally eliminate the daycare expenses, but his income as well. Now that we're considering a Ch13, I beginning to wonder how all of this would play into a plan. And since the payment plan would be based on the prior 6 months of income, I'm wondering if he would need to quit his job now as opposed to in December when I go back to work. But would it be frowned upon to file with one spouse voluntarily unemployed?

Anyone have any thoughts on how this may play out and what our options are?

[HHM]

Actually, the payment plan is NOT based on the prior six months (thank you U.S. Supreme Court in Hamilton vs. Lanning).

I probably would NOT recommend having your spouse quit his job unless the numbers truly worked out in your favor. Chapter 13's have inherent flexibility, so if expenses go up, you can modify the plan.

Also, unless something is pending such that you must file (i.e. foreclosure scheduled for July 30), you should probably wait until after the baby is born before filing your case. However, you should probably get an attorney engaged now to help you plan your BK so it can be as successful and beneficial as possible.

[bkstuff]

I think the difference would be whether or not you are above or under median income for your area. If I understand this correctly, if you are above median then you are in a 5 year plan. If under then a 3 year plan. That could make a difference.

[momofthree]

Honestly, regardless of the bk, it would make no sense for your dh to continue working if his income is $1800 and daycare costs $1600. Add in gas for work, work clothing, other job expenses (cell phone, work lunches, higher car insurance, etc), you'll probably be out more money if he's working than if he's not. Especially if he starts making meals from scratch, couponing, etc.

I'm not anti-daycare. In fact, I'm an infant daycare teacher, and while I adore "my" babies and treat them as my own (okay, better than I do my own! lol), there is simply no replacement for being cared for by a parent 100% of the time.

Just my 0.02. Sorry to stray from the bk topic.....

As for your questions:

About having a stay-at-home parent, answer honestly if they question it. Due to the high cost of daycare, it cost more money for him to work than to stay home. It is what it is, especially in this economy where just finding a job at all can be difficult.

Now that the new guidelines passed about a ch.13 plan payment not being based on the 6-month lookback any longer, have him work as long as possible (unless, like bkstuff mentioned, it will make a difference in your above/below median status). If you can save that extra money or spend it down on necessary expenses before filing, that would be ideal.

GL and KUP!

[ylime]

Thanks all.

It looks like without my husband's income, we're below the median income for a 3 person family and even with his income we'd still be below for a 4 person family if we waited to file.

Definitely a lot to think about!