How are people able to get 6-figure incomes & file Ch. 7?

[debtmonster]

I am curious to know why do people on the BK board have such a problem with high income filiers, when the UST/Trustee/BK Court didn't?

It's not having a problem with them, it's just shocking. If I made a 6-figure income, I'd be able to pay cash for stuff instead of charging it.

All of my friends who have 6-figure incomes are all doing very well and have no debt.

A friend of mine makes $86,000/yr. and has been lucky enough to keep his same job for 10 years with no income gaps.

He paid his house off in less than 5 years. He has a Discover card that he racks up and he can afford to pay the balance off in full each and every month.

His car, his wife's car and his daughter's car are all paid off in full. He bought all of the cars new, one at a time.

Since he was not paying a mortgage, he was able to sock all of that money away to pay cash for the cars.

He uses Amsoil oil in all of them and only has to change the oil one time per year, so for 3 cars, he only has to do 3 oil changes per year, which is dirt cheap.

The guy is living like a king.

If only I could have a solid income like that for a long period of time, my entire life would be different now.

[Flamingo]

It's not having a problem with them, it's just shocking. If I made a 6-figure income, I'd be able to pay cash for stuff instead of charging it.

All of my friends who have 6-figure incomes are all doing very well and have no debt.

A friend of mine makes $86,000/yr. and has been lucky enough to keep his same job for 10 years with no income gaps.

He paid his house off in less than 5 years. He has a Discover card that he racks up and he can afford to pay the balance off in full each and every month.

His car, his wife's car and his daughter's car are all paid off in full. He bought all of the cars new, one at a time.

Since he was not paying a mortgage, he was able to sock all of that money away to pay cash for the cars.

He uses Amsoil oil in all of them and only has to change the oil one time per year, so for 3 cars, he only has to do 3 oil changes per year, which is dirt cheap.

The guy is living like a king.

If only I could have a solid income like that for a long period of time, my entire life would be different now.

To me this sounds like just a case of jealousy on your part as to high income folks doing better than you because you don't make what they make or have what they have. I don't think you see this yourself. You see making more as the answer to all your problems. As others have advised you in all your past postings on here, you have lived beyond your means for years and apparently still want to do so but you can't. You are not those people and have your own life and your life is what you make it. You state "luck." Maybe they did a lot of planning and saving and just made the right choices. Unfortunately, when some of us post to you what we are seeing, you go into denial. The situation is what it is and it will not change unless you make the changes to turn things around in your life.

[Overmylimit]

I tend to agree with Flamingo, when I was making great $$ I paid all of my credit cards off every month also. I had times where I would charge thousands each month and pay it off the next.

What you have to remember is when you GROW into an income it doesn't happen overnight. It happens slowly and your spending habits change slowly as well. Before you know it you can wind up in trouble. Now if I had went from 50k to 200k in one month sure I would be the cash king and the world would be roses, but it does't happen this way unless you hit the lotto.

[debtmonster]

I can't keep a job long enough to get to that point. I also don't have $50k to get a degree and cannot get a school loan because I make too much money. Sucks to be in the middle.

[HHM]

Look, even high income people often do not know how to manage money. Just 'cus you earn good money, doesn't mean you know how to properly spend it or save it. As income increases, expenses tend to increase, but that is 100% the fault of the person, they allow their lifestyle to migrate upward. As a result, if something happens, loss of job or income, they have no resources to cope.

That is the point that is driven home by the book, the Millionaire Next Door. Most people who have cash net worth, i.e. at least $500,000 in liquid assets (not paper wealth, i.e. home equity etc), got there by spending frugally, saving and making sacrifices. They don't have $5,000 mortgages and $1,300 per month car payments, and they don't borrow money for consumer purchases. If they borrow money at all, it is to get a return on investment.

There is a difference between income and wealth. Most people have income, but very few are wealthy. And most people I have seen or know who have 6 figure "incomes" are poor when it comes to wealth. They are technically bankrupt because their liabilities exceed the value of their assets.

[paintinrosesred]

I agree completely with HHM. Money isn't the answer to our problems. I have that book.. need to dig it out and read it. So true.

[Overmylimit]

As a result, if something happens, loss of job or income, they have no resources to cope.

This is very true poor planning leads to disaster sometimes.


I read the book and it was dead on to a lot of people I know.


I do have a 5k mortgage but at the time when I was making my most it would have been equivalant to somone making 50k per year and a house payment of 950. Even though the amount was big it didn't seem that bad. Ahh but hindsight is always 20/20

[debtmonster]

I don't know what's going to happen once we lose out house. I know I will need about $7,000 for a decent car. I just wish I could keep this car for 6 months after the BK so I could have time to save up the cash and not finance again, especially at high interest. I want to pay cash for everything from this point forward.

[biotechsolution]

debtmonster:
You will probably find out most of the high income filiers $150K+ are business bk's. I would venture to guess most of the business bk's have very little consumer debt, that's not the reason they are filing. Our combined income was over 200K, close to 250K. And you're right, we paid off all of our cards every month. Car loans but both at 0% interest. But just like a bankruptcy filed for consumer debt your credit takes essentially the same hit. But the advantage is since you have less negative accounts and the business accounts don't show up on the credit reports I think your credit report recovers quicker. Mine is 15 months post discharge and I just cracked the 700's on all three reports, FICO.
But I do agree with you if you are making a good 6 figure income it could be hard run up a lot of credit card debt. We even have a mortgage over 3K and school tuition of 18K a year.

[Overmylimit]

Biotech, I have a question about the business credit lines. They have never shown up on my credit report. I have credit monitoring and they do not show. I am wondering since its all business credit lines (even though I personally guaranteed them) and I file bk does the balance show then or does it never hit the credit system. Thanks

[biotechsolution]

Biotech, I have a question about the business credit lines. They have never shown up on my credit report. I have credit monitoring and they do not show. I am wondering since its all business credit lines (even though I personally guaranteed them) and I file bk does the balance show then or does it never hit the credit system. Thanks

none of my business lines of credit have every shown up on my credit report so far 15 months post-discharge. Chase the only card I let go in my BK did show up after discharge but has since been deleted from my report. They kept reporting it in a charge-off status (it had never been late prior to filing) I sent them a motion to reopen and show cause. They deleted it.
If you just have business lines your credit report should only show the bankruptcy discharge.

[Cali]

Making 6 figures is subjective, not everyone that makes 6 figs live in a low cost of living area. My rent is more than many pay for rent in 3 months in some areas.

I have 6 and 7 fig friends, many are not debt free, but some are.

It seems from a few posts that if you make x amount you shouldn't file even if you qualify. I don't recall reading anywhere that said because we made x amount and qualified, we couldn't file because of our income.

It's not having a problem with them, it's just shocking. If I made a 6-figure income, I'd be able to pay cash for stuff instead of charging it.

All of my friends who have 6-figure incomes are all doing very well and have no debt.

[Overmylimit]

Thanks Biotech, all of my lines of credit are business except for a few small cards. I had a feeling it wouldn't show but I wanted to check it out. Thanks

[Dollar Bill]

BIO TECH - I have a few biz credit lines that popped up on my credit report. One shows a charge off status. I disputed them as corporate. Do you have suggestion for trying to have them removed?

[debtmonster]

Making 6 figures is subjective, not everyone that makes 6 figs live in a low cost of living area. My rent is more than many pay for rent in 3 months in some areas.

I don't see the point of making 6-figures in a high cost of living area as your net after bills will be the same as someone making much less. Why do people do this? What are in people's minds that makes them not think this out?

If you're living in NY living in some dinky apt and making $120k/yr. and after all of the high taxes and barely have $800-1000 left and could be living in Florida or some other cheaper state making $80k and having $1500-1800 left and living in a nicer and larger apt., why would you want to live in a worse place to have less money left over? That's not getting the best bang for your buck.

I've had job offers to go to NY and I told them I would not go unless it was at least $150k. Florida's $800/mo. apartments are like $3500-4500 up there. Not to mention all of those sick taxes. I don't know how anyone can afford to live up there with that crap.