Chapter 13 Budget

[randy5724]

Thanks in advance for any info. New to forum, been looking at Chap13 for a few months now, met with lawyer last week plan, to file 1st of April. Been reading some comments on living on a tight budget in Chap 13, but can it be any worse than than trying to stay current with monthly bills. Been paying house and car 2 weeks late with late charge and paying credit card on time, then charging heat and light bill on the same card. Have CC debt of $70,000 and some at 22% interest. I am thinking that the Chap 13 budget has to be better than the way we have been living. Thanks for any thoughts

[momofthree]

We have a lot more breathing room than we did before filing, and we didn't even claim full IRS exemptions. I'm very jealous of those who have enough income to spend (or at least budget) full IRS limits each month! ((we chose 13 over a 7 so we could lien strip, hence the tight budget. We're over $20k under median income))

[jetsfan2010]

if you stick to it, it actually will help you make it. paying that high of interest on credit card debt isnt healthy for anyone IMHO

[jange]

Thanks in advance for any info. New to forum, been looking at Chap13 for a few months now, met with lawyer last week plan, to file 1st of April. Been reading some comments on living on a tight budget in Chap 13, but can it be any worse than than trying to stay current with monthly bills. Been paying house and car 2 weeks late with late charge and paying credit card on time, then charging heat and light bill on the same card. Have CC debt of $70,000 and some at 22% interest. I am thinking that the Chap 13 budget has to be better than the way we have been living. Thanks for any thoughts

randy5724, If you do your ch 13 plan correctly and account for all your expenses, and then stick to your budget it can be much better that before filing. We are 14 months in and life is much easier. I have money left over at the end of most months, I am no longer stressed about paying bills or if we will even have enough to pay everything.
Shortly after filing we had several unexpected large items that came up but I was able to pay for them using my emergency savings. I am now working on building that back up.

good luck

confirmed 7/22/10

[randy5724]

Thanks for the encouragement!!

[13for60]

I agree with the above statements. I was concerned about our high payment, but this is what I discovered:

Our Chapter 13 payment is the eqivalent of one first class ticket from San Francisco to London on Virgin Atlantic (something on my bucket list that I have been trolling for years) - $3300 or so. When our "contract" is over, I will have purchased the eqivalent of 60 first class tickets, which is enough to buy out the entire first class cabin and pack it full of all my friends (and definitely some BK Forum folks, too!).

Prior to filing, and juggling all the pieces, I was basically buying two-and-a-half tickets every month and not getting anywhere with anything. Talk about mind numbing! When I think about what the last few years have been like - and the stress on my family - there is no doubt in my mind that i should have done it a long time ago. Hindsight is what it is - I have officially learned my lesson.

So, now we make our $3300 payment and we're still able to put money in the bank. It's a bloody miracle!

(Sidebar - I do have a full on rant brewing about the rhetorical BS that the system refers to us going through BK as getting a "fresh start." What a crock! It struggling and fighting the whole time for understanding and respect among the credit world. I'm not even t alking about credit cards specifically - renting a house, getting a job - the indirect things that somehow reqire a credit score. Biut that's for another post...)

Deep breath! You're going to be fine!

--13for60

[LadyInTheRed]

Before Chap 13, I was paying $450 a month to credit cards and that was about to go up significantly because of an expiring intro rate on a $10k balance. I was also paying $540 a month on a Heloc. I am stripping the Heloc and bought a car before filing. So, I replaced the $990 in monthly payments with a new car and a $500 plan payment that includes the car payment. Things are much easier now! I do know I have to be careful to spend as little as possible so I can save money for once-a-year expenses and unexpected expenses that I used to pull out the credit card for. I had some unexpected expenses very early on, but am now starting to build up a bit of a cash cushion.

[chicagoed195]

We don't have a lot of additional unallocated funds left over each month, but my phone only rings when someone I actually wish to talk with calls. We still go on vacation, just not lavish vacations. We still engage in recreational activities, just not nearly as often. We have an emergency fund, so if something big breaks we can deal with it without severe emotional trauma.

Is it a great life under Capter 13? No, but it sure beats the hell out of where we were prefiling.