New Savings Account Before Confirmation

[junquemayle]

My ch13 341 hearing is scheduled for mid-December.

I am concerned about managing my budget, so I have been looking at several online financial management sites, including Mint.com, Yodlee.com, and PocketSmith.com. These sites seem to help track spending and for budget planning.

I am realizing that there are certain items which require me to set aside amounts for future use. For example, my water and trash are each billed quarterly. Also, I have several items like home maintenance and car maintenance that don't have regular payments, but which will be coming (muffler, brakes, tune ups, tires; boiler maintenance, etc).

I would like to use multiple bank accounts to set aside the "future" expense money, so that I am not tempted to use my tire money for something else. I have found several online bank accounts (like ING Direct Savings) that don't have service charges or minimum balances. However, I see that a credit check is part of the application process.

Here are my questions:
Will I run into any issues trying to open a savings account while in Chapter 13?
Should I wait until I am confirmed?
Does anyone have any experience trying to open a new account during repayment?

Thanks!

[FishersMike]

I have multiple checking/savings accounts. Applying for a bank account is not the same as applying for credit. You can still have credit check done on you. You should be able to open up all the bank accounts that you want, but make sure you let them know about all your accounts. Also you may need to bring in statements to your 341 of your bank account balances - if you do, make sure you include them all.

[junquemayle]

Ok - that makes sense. However, if bankruptcy doesn't impact the application, I'm wondering why they even run a credit check for a savings account to begin with...

[Pandora]

I would like to use multiple bank accounts to set aside the "future" expense money, so that I am not tempted to use my tire money for something else. I have found several online bank accounts (like ING Direct Savings) that don't have service charges or minimum balances.

Setting up multiple bank accounts is fine, but in the end it comes down to how easily is it accessed when you need it? How long does it take for deposits and transfers?

In a 13 - its all about control - you have to set aside X amount for every item you have to pay, and stick to it. If you cant do that, then it wont matter if you use a bank to store your money or the envelope system. Envelope system works great - then lock it in a safe or something with the knowledge that it is to pay your future bills. Putting the money in a bank isnt going to help you if you cannot get the control needed as you can still access it, probably even easier than having it in the house IMO. If you're given a debit card with that account, its much easier to say "oh man I really want this item and I have that extra money in my account - I'll replace it next month and make it up." In reality - its a slim chance you will actually make it up and will end up in the hole. Much harder to be somewhere and not have that money easily at hand because its sitting at home locked up

We do the envelope method except I have an accordian type envelope that has tabs - each tab has its marked purpose and the money goes into each category every month and it works for us. We do have 2 bank accounts as well but gotta tell ya, its a PITA to keep track of 2 checking accounts and pay bills out of them separately every month. Also a pain to get monies transferred from one to the other (1 is local, 1 is not) as that takes on average, about 5 days.

[jange]

I have 2 checking accounts, my regular (local) checking and also an ING online account. I use the automatic transfer to move money over to ING every week. In my ING account, I have 2 savings and a checking. I pay my own property taxes so I put money aside each month for that. The other saving is what I use to put month aside for small trips, gift shopping etc. If I need to use the saved money to pay for things I move it to the ING checking account which they give you a debit card. It moves immediately, otherwise it takes several days to move it back to my regular checking account.
I had the ING account before I filed so I am not sure what they check. The trustee didn't have any issues with any of the accounts. I just had to provide the statement that covered our filing date. Having the extra ING account works for me, and having the automatic transfer forces the savings.

confirmed 7/22/10

[junquemayle]

Having the extra ING account works for me, and having the automatic transfer forces the savings.

Yes - this is what I was thinking. Rather than having cash lying around, I was thinking that an automatic transfer would force me to save for quarterly budget items, as well as build up a fund for car and house repairs.

I think I will use the ING Direct account, because there are no fees and and no minimum balance requirements. There is also the option to have a kids savings account, so that I can teach my kids the right way to budget and save.

[tammygirl1]

I opened 2 savings accounts since confirmation without questions. They were linked to an existing checking so not sure if that made a difference...What I did was opened a short term savings (ie semiannual insurance, auto registration, etc.) which I have pulled out a set amount monthly. I have a 2nd savings which I call Emergency Savings. This is the bucket I transfer all extra DMI after after bills are paid during the month which I would pull from for emergencies, unexpected expenses, etc. It has worked for me the last couple months.

[jange]

Yes - this is what I was thinking. Rather than having cash lying around, I was thinking that an automatic transfer would force me to save for quarterly budget items, as well as build up a fund for car and house repairs.

I think I will use the ING Direct account, because there are no fees and and no minimum balance requirements. There is also the option to have a kids savings account, so that I can teach my kids the right way to budget and save.

I have had the ING account for several years and never had any issues.