how to spend cash question

[monkatom]

[keepmine]

If you're already negative on the means test, I'd leave well enough alone.
How much money do you need to "lose"?
Have you looked at putting it into actual assets that are exempt like, an IRA?

[FreshLikeADaisy]

The thing that worries me as I read your post is that you are putting some away for the summer months; i.e. there is a bank balance. A trustee is not going to care that that is your "summer pay"; it will be just another balance that can be seized. I am assuming your wife is a teacher and so has the option to do the 10 month or 12 month schedule.

Just for now, I think going to the 12 month for as long as your bk takes would probably be wise. (It will also drop your monthly income to do this, which can't hurt.) The problem with exempt assets is that they are hard to get into when you need them and you don't want to pay the tax and penalties on an IRA just to save it for the summer months when you need it.

[monkatom]

yeah I am worried about going to a 12 pay as it will make our means and IJ tests seem worse then they are. I had planned to purchase gift cards for the grocery store or clothing stores this way after the BK i can use the gift cards for gas, groceries, clothes, etc and we could use cash for bills. Just spoke to attorney and he said as long as we do not make huge purchases at grocery store it should be OK as the trustee will not normally start looking at receipts. He also said we could probably exempt some cash with the homestead or wildcard exemption so i may just wait and see what happens with my house and ring appraisals. I am concerned as zillow is appraisaing my house at 35K more than I owe so I will have to use system 1 in CA and will loose that homestead exemption that i want to use to cover a car and jewelery. Attorney recomends getting a real estate broker to do an appraisal for about $50 which will hopefully come in lower than zillow.

[FreshLikeADaisy]

From what I've heard, Zillow comes in very high for a lot of people. I think you're wise to get the 2nd opinion. Good luck!!!

[nazstar]

I am already (500) on the means test and (128) on the I and J so by changing to 12 pay this will only increase those amounts which could cause problems with the trustee??

Why would the trustee have a problem with you being negative on the I and J schedules? I don't get this? We will be negative each month by about $500 - 900 (depending on whether or not I use an upcoming lump sum to pay the IRS and my student loans). My husband can rake in the overtime when he needs to, but we are trying to avoid that to stay below the median. Once the bk is done, i told him to feel free to volunteer for as much OT as he wants. But for now, our I and J looks nasty! We were going to do the same as you and pick up gift cards for the supermarket here and there to spend my bonus. Nothing outrageous, but throw in a $20 here and another $40 there with our groceries for emergencies while we are filing. I suppose I could stockpile but I really don't have the room to store all that! I've already dedicated a walk in closet to stockpiling pampers, formula, batteries (we live int he hurricane state), canned goods, and some other needed items like toilet paper. It looks like a damn fallout shelter! If the trustee ever questions, I'll invite him over to check it out! LOL!

[monkatom]

I thought the trustee may have a problem with being several hundred in the hole each month on the I&J as it shows that even with BK you will still be in trouble. Not sure about your situation but for us I feel being more than 100-150 in the whole on the I&J could cause a red flag and have the trutee, court etc decide it would be better for us to give up the house as it eats the bulk of our income.

[nazstar]

yeah. I see your point. In our case, there is really nothing left to cut. We are way within our allowance for expenses EXCEPT rent (average is $1200 and we are at $1600). But, other than that, we come in hundreds below in the remaining categories. Just the nature of a one income family in 2007, I guess. If the trustee said anything, i would tell him that my husband is currently in a training program to get a better job. I really can't say much else. He makes $60,000 a year - that's not a bad salary at all! But we get nailed on car insurance ($450/month) because of his history of tickets - which is another stupid story and not 100% his fault.