What to do with pre-Ch7 money?

[signal]

I am intending to file for Ch7 around Feb 15th. I will have received a tax return, as well as a company reimbursement for education expenses I spent this last semester ($3k). By this time I will have stopped paying creditors. This could be as much as 10-17k of money.

As I understand it, spending large sums of money right before a BK can be a bad thing. I don't want them to get this money as an asset of course. Is there a posting or a list somewhere that gives people ideas of what are some things to put the money into that would be less objectionable by a trustee?

I thought of buying a bunch of emergency stuff, like lights, batteries, etc. I live in florida and we have hurricanes. I thought of stocking up on a years worth of various household items like cat food, canned goods, etc. But I dont know what is or is not a good idea. For example, I lost 18 lbs over the last 8 weeks, and I have dropped 2 pants sizes, I thought about buying some clothes but maybe thats a bad idea. So I am looking for advise on whats the smartest thing to do with this money.

Obviously a large chunk will goto legal fees (my current lawyer of choice is about $5500).

[DeadManCrawling]

Do you own a home?

Florida protects "eve of bankruptcy" spending on homesteads. You could, literally, add a million dollars worth of improvements and file the next day. And the creditors could do nothing about it.

This is well-established by case-law and marks Florida as one of the most BK friendly states.

There are, however, some restrictions. You must have lived in FL for two years prior, or the homestead exemption can be limited to $125,00 (A little higher now, adjusted for inflation).

The creditors in question won't get anything unless they are: Child support, IRS, alimony, or judgments from a criminal proceeding.

If you own a home, consider a backup generator big enough to power the whole house and a large propane tank (500-1000 gallons). We have a 1000 gallon tank and a 40kw generator. This house can run for as much as four weeks without power. That includes the A/C units and everything except the pool/hot tub.

[DeadManCrawling]

One other quirk of the homestead in FL.

To qualify as exempt, a property must be less than 1/2 acre if in a municipality. Or less than 160 acres if it is located in the county, outside a municipality.

[DeadManCrawling]

If no homestead, look into things like dental care that may have been neglected, stock up on household items, eyeglasses, pretty much anything that can be viewed as a necessity.

Perhaps a large freezer. Load it with food for the future.

All this should be okay. As long as it can't be viewed as luxury purchases by the court.

[frogger]

You can spend a lot of money in a hurry when stocking up on supplies and essential items.

[signal]

Understood. I thought about buying pre-paid gas cards. I think you get a discount and can lock in the price to boot. I will have to ask my lawyer if buying a few thousand dollars in pre-paid gas is an issue. I know its something I will need.

[AngelinaCatHub]

Prepaid gas cards are of intrinsic value and may not qualify. Have you considered putting it into a bit of retirement? I agree with all above about stockpiling especially storable food. It freezes the price in inflationary times as well as you may be seeing a lot of civil trouble if this d/recession gets much worse. (get some ammo too). 'Hub

[signal]

I will have to discuss with my attorney, I have no problem putting it into retirement, I just dont want to have alot of cash when I file and I dont want to put it into something thats going to jeopardize my case.

[swampwiz]

Go see your dentist, and ask if there is anything that needs to be done. Get your eyes checked and get new glasses. Do the same with your car - get any maintenance that needs to be done sometime in the somewhat near future. Have a room without furniture? Get standard grade furniture. Have old windows or doors? Get new ones (if you are going to be keeping the house.) Buy a new computer (sabotage your old one somehow in case the trustee wants to see it no work), or get an extra hard drive or memory.

[southernbelle]

Do you need a new roof, paint, floors, doors, or windows? Go to the doctor, denstist (do your kids need braces)? Buy a freezer and stock it up and fill the pantry (a Sam's or Costco card would come in handy). Do you need clothes for work? Do your kids need school clothes or shoes?

Like someone else said, buy a generator, batteries and emergency gear. I live in Louisiana and NO ONE would question purchases like that down here.