What do you do with all the "extra" money?

[crescentmoon]

This may seem to be a stupid question, but what do you do with all the "extra" money once you stop paying unsecured debt?

My husband and I have gotten so used to living on nothing, that we don't know what to do now that we aren't sending out over $2000 every month in unsecured debt. We are still happily paying our secured debt, and are slowly taking money out of the bank in preparation for paying our attorney for filing Chapter 7. We fall well below the median income for our state, but again, we have been so used to living on nothing - no cable, no movies, basic eating, no vacations, nothing really special in our house.

So, now we don't really know what to do with the money that isn't getting spent on debt. Do we slowly take it out of the bank? I think we'll eventually get cable, but don't want to add anything while we wait to file for Chapter 7.

Are we doing something wrong here to have this "extra" money? Once we are discharged, we are looking forward to paying off the car, and also start contributing to retirement. But, what do we do with current salary coming in?

[klandsb]

Must be a relieving feeling !!

The first thought that came to my mind was one of my mom's favorite quotes " Don't count your chickens until they hatch " but that is very negative so I must first congratulate you...
Sometimes it give you a good feeling to help the less fortunate.. I am not talking hundreds & hundreds of dollars but maybe just a $25 a mth donation to a charity of your choice will give you the satisfaction of knowing you are helping someone.. There are alot of charities that are a rip off but if you investigate there are some very good ones.

[Iwantmyname]

They might look at it and determine you can handle a chapter 13.

[crescentmoon]

The thing is, we could afford to pay some of the creditors. But, we can't afford to pay them all. My understanding is that we can't pick and choose who we pay, so we haven't been paying any of them.

Is there a better way?

[bk2009]

You said you have no cable, perhaps it's time to get some? What about clothes, when was the last time you bought some new clothes? What about the house, any deferred maintenance that you need to do on that?

[crescentmoon]

That's all great suggestions.

And its not like we'll have thousands of dollars left over each month. We just won't be going more into debt each month. For the first time, we'll have some extra money each month.

Home maintenance is actually a really good suggestion. We have about $3000 of plumbing work that needs to be done.

And I like the idea of new clothes, etc.

The question is, what do you do with this money while waiting for Chapter 7 filing and the process. Wouldn't buying new clothes and getting cable raise some flags? Do you just take it out of the account slowly so as not to raise red flags?

[bk2009]

Buying new clothes? Not likely. I mean, don't go hog wild, but if you bought a few pair of pants, a few shirts, underwear, etc - I'm sure those would be considered reasonable. I mean, you probably haven't bought in years because you're too busy paying CCs! I wouldn't go crazy and go on a shopping spree, kwim? I think if you just spent a little bit, it wouldn't raise eyebrows, while also replacing some of your clothes.

If you've got $3k worth of plumbing repairs, that shouldn't raise a flag at all. But, if you don't have the money to pay all at once, perhaps you can just have a bit done each month? Like, maybe they can do a portion at a time? If you're doing the work, you could likely just buy the parts as you can afford them.

Just remember to keep receipts for everything!

[aces67]

I thought that too at first and was excited but it turns out for us since we didn't have the money to pay the debts to begin with we still don't have any extra money either.

[klandsb]

Living on cash only:

I have been living the "cash only" life since last SEPT when I closed all my credit cards.... Its amazing that before payday comes I am cleaning out the bottom of my purse and looking thru old coat pockets looking for change to get me thru till payday... Sad but true... Its all those things I use to use my charge cards for that come up that u dont think about... Haircuts, prescription medicine, dog vet bills if and when the dog might get ill, they all take a chunk out of that money you thought would carry you thru till payday...
JUST FOOD FOR THOUGHT !!!!!!

[bankruptsee]

We're making more money now than the last six months and it doesn't add up. Basically, because we're spending money on things that we needed all this time but couldn't afford.

[keepmine]

That's all great suggestions.

And its not like we'll have thousands of dollars left over each month. We just won't be going more into debt each month. For the first time, we'll have some extra money each month.

Home maintenance is actually a really good suggestion. We have about $3000 of plumbing work that needs to be done.

And I like the idea of new clothes, etc.

The question is, what do you do with this money while waiting for Chapter 7 filing and the process. Wouldn't buying new clothes and getting cable raise some flags? Do you just take it out of the account slowly so as not to raise red flags?

You are allowed to live a reasonable lifestyle. You don't have to slowly take money out of the bank. It's permissible to write your lawyer a chaeck. It's OK to write the plumber a check.
Go ahead and get new clothes and basic cable.
Other reasonable expenses would be things like dental work you've put off. Take the family for eye exams and get new glasses/contacts if needed. Go to the doctor if you haven't been in awhile for physcial or any other needed treatment.
What about the car{s}. New tires , needed maintenance?
Back to the house-have your heating and cooling stsytem checked out. Any appliances need replacing/repairing? What about paint and gutters?
Also, ask your lawyer how much cash you can exempt. It'll vary by state.
I think you get the picture. It won't be hard to spend down if, that's what you need to do.

[whipster1]

Just live like you are supposed to. Congrats on removing the yoke.

[Amy26]

What is this extra money of which you speak?

[justplaintired]

What is this extra money of which you speak?

This is funny!!! LOL I know exactly what you mean, we don't seem to have that either!


We didn't end up with extra money, we just were able to survive via cash for all the things cc paid for. Groceries I use cash, 2 teenage boys at home, need I say more? Gas for 2 cars and a pick up, cash for everything. Maybe at first I felt rich, but that wore off. Now I just feel like I don't owe anyone for buying food or all those other necessities. That feels pretty good.

I would say if you can you better not show too much money and not enough expenses or you will not be a C7. You need to live again, cable, home repairs. There is so much income that is exempt for normal living expenses, maybe you should look and see what the trustee considers normal, and start using your extra cash that way. You are allowed to live and spend money for "normal" living expenses. Phone, cable, internet, newspapers, entertaining (eating out), occasional movie, clothes, haircuts, school expenses if you have kids, the list goes on and on.

Enjoy life just use cash, it's ok.

[RackingJ]

This is funny!!! LOL I know exactly what you mean, we don't seem to have that either!


We didn't end up with extra money, we just were able to survive via cash for all the things cc paid for. Groceries I use cash, 2 teenage boys at home, need I say more? Gas for 2 cars and a pick up, cash for everything. Maybe at first I felt rich, but that wore off. Now I just feel like I don't owe anyone for buying food or all those other necessities. That feels pretty good.

That was us as well. I thought we'd be doing so much better not paying the $1100/mo in payments but life has a way of getting in the way of that. LOL