Sitting on $2k before I file?

[Strelok]

Hello everyone,

First of all great forum, it has been enormously helpful. Although I'm not filling pro-se I have learned a ton about bankruptcy. So thank you to everyone that has contributed.

As of today I am trying to save money for a retainer fee plus the Bk filing fee and courses. Today is the first month I have stopped paying my creditors which will free up a lot of money.

I am filing for a chapter 7 no asset case per the lawyer I wish to retain. I have around $38k in unsecured credit card debt and a loan.

My question is I will have the money for the lawyer and filing fee come December. However I will have around $2300 in my bank account after paying the lawyer if I file in January.

I've read that you want to have close to nothing in your bank accounts, so what do I do with this money before December? Can I help pay for expenses with my family at all or do I just spend it on myself? I was gonna save that $2300 for any lawyer expenses that come up during the Bk process but I guess I can't.

Any advice or guidance would be helpful.

Thanks.

[justbroke]

Whether or not you need "close to nothing" in your bank account is highly dependent on what bankruptcy exemptions are available to you. Since you may actually be from Pennsylvania and filing in Penn, then you may be able to use the Federal Bankruptcy Exemption scheme which typically has more power to exempt cash (using a wildcard exemption).

These are things about which you should speak to you lawyer.

[lukesky]

Whether or not you need "close to nothing" in your bank account is highly dependent on what bankruptcy exemptions are available to you. Since you may actually be from Pennsylvania and filing in Penn, then you may be able to use the Federal Bankruptcy Exemption scheme which typically has more power to exempt cash (using a wildcard exemption).

These are things about which you should speak to you lawyer.

Well, you could always give it to me, no ...HA! Sorry, just a little humor there. I am in a Chapter 13 and just starting out with it and I know any monies of that value will stand out like red on black. I wish you luck.

[brokehmowner]

If it were me I would start paying bills with that money. Then take the money you would have used and start making deposits into the mattress account. If you're looking to keep $2k, that would be perfect, strategically placed of course.

[LadyInTheRed]

If it were me I would start paying bills with that money. Then take the money you would have used and start making deposits into the mattress account. If you're looking to keep $2k, that would be perfect, strategically placed of course.

If you have money under the mattress, you must report it as on asset on your BK petition.
As Justbroke pointed out, the answer to this question depends on whether there is an exemption available to cover the cash, whether it is in the bank or under the mattress or being held by a friend for safe keeping.
One thing to remember is that if you have outstanding checks, you can't reduce your account balances by the amount of those checks. So, make sure all checks clear before you file a Chap 7.

lukesky, having non exempt cash in a Chap 13 is often not an issue because you have the entire 3 to 5 years to pay that amount to unsecured creditors during your plan. It does not need to be immediately turned over to the trustee as would be the case with non-exempt cash in a Chap 7.

[lukesky]

If you have money under the mattress, you must report it as on asset on your BK petition.
As Justbroke pointed out, the answer to this question depends on whether there is an exemption available to cover the cash, whether it is in the bank or under the mattress or being held by a friend for safe keeping.
One thing to remember is that if you have outstanding checks, you can't reduce your account balances by the amount of those checks. So, make sure all checks clear before you file a Chap 7.

lukesky, having non exempt cash in a Chap 13 is often not an issue because you have the entire 3 to 5 years to pay that amount to unsecured creditors during your plan. It does not need to be immediately turned over to the trustee as would be the case with non-exempt cash in a Chap 7.

Thank you LadyInTheRed, but it sounds like then you will have to turn it over at some point? Maybe it is best not to have any cash laying around where ever it is so they can see/get to it.

[LadyInTheRed]

lukesky, it gets paid through your plan payments, in most cases without an increase in the payment. It is handled like any other non exempt asset in a Chap 13. If you can't find info explaining how non exempt assets are handled in a Chap 13, start a new topic under chap 13 so we don't throw this topic off further.

[lukesky]

lukesky, it gets paid through your plan payments, in most cases without an increase in the payment. It is handled like any other non exempt asset in a Chap 13. If you can't find info explaining how non exempt assets are handled in a Chap 13, start a new topic under chap 13 so we don't throw this topic off further.

True and Thank You