Did YOU start saving after you filed?

[coolmom04]

I've been reading that it's okay to start saving money once you've filed b/c after you file, the trustee can't touch the money you earn/save whatever that is in your checking/savings accounts... except of course inheritance, right?

I emailed my attorney's office to make sure b/c I wanted to hear it from them personally.. I forgot to ask when I met with them last. The attorney did write on our schedule J "will need to save money to buy a replacement car."

So, we want to start saving about $1000/month... is it okay to do that? Can we put that in our savings account with confidence that it will stay there and remain ours as long as we earned it legally? I mean - if it's obvious it came from paychecks? It will take some major budgeting, but we have to save up about $3K to buy another vehicle by the time they take our van.

We are already going to have to pay $1100 for insider payments and I don't want to lose anymore of our money than we have to!

So, did anyone save money after filing and if so, was your money safe?

[DeadManCrawling]

We started saving immediately, since our expenses dropped dramatically.

After the 341, we moved from our albatross into a new place. This cut our utility expenses by about 1800/month and general maintenance by another 500-700/month. In addition, we really looked hard at our other expenses like groceries. We started using a lot more thought when buying things in all areas. We got rid of unnecessary monthly fees, cut out some of our cable bill, got rid of land line phones and faxes and so on.

Our total monthly savings is anywhere from 2k-6k per month. By the time we had our 341, we had about 7k saved, which included some one-time things that don't happen every month.

No one asked about it. Trustee didn't request further statements or info of any sort.

I discussed with our attorney as well, and he said it was no problem. The law is kinda screwy with regards to this. Everyone knew we were giving up our house and moving, which would negate our largest monthly expenses. But we were able to claim those very expenses on the means test and schedules going forward. This varies by district, I think.

I am not complaining, by any means. It was definitely a huge plus for us. But from an objective point, it makes no sense at all.

I wonder if there is a "safe" limit or ceiling? I am interested to hear what your attorney says. For example, what if I was able to save 70k, instead of 7k, prior to the 341, for some reason.

Best,

-dmc

[Mensa1]

I wonder if there is a "safe" limit or ceiling? I am interested to hear what your attorney says. For example, what if I was able to save 70k, instead of 7k, prior to the 341, for some reason.-dmc

One of the Q's most TT's ask is "has anything changed in your situation since filing?" I would consider saving 70K in the 6 wks since filing, a "material change".

Other events that could impact the filing would be windfalls, like inheritance or lotto winning, or ??? These are typically a problem if before discharge, or if after disch and within 180 days of filing date of the Ch 7 bk. Outside 181 days is a non-starter, and pst disch, as I understand it.

[coolmom04]

We started saving immediately, since our expenses dropped dramatically.

After the 341, we moved from our albatross into a new place. This cut our utility expenses by about 1800/month and general maintenance by another 500-700/month. In addition, we really looked hard at our other expenses like groceries. We started using a lot more thought when buying things in all areas. We got rid of unnecessary monthly fees, cut out some of our cable bill, got rid of land line phones and faxes and so on.

Our total monthly savings is anywhere from 2k-6k per month. By the time we had our 341, we had about 7k saved, which included some one-time things that don't happen every month.

No one asked about it. Trustee didn't request further statements or info of any sort.

I discussed with our attorney as well, and he said it was no problem. The law is kinda screwy with regards to this. Everyone knew we were giving up our house and moving, which would negate our largest monthly expenses. But we were able to claim those very expenses on the means test and schedules going forward. This varies by district, I think.

I am not complaining, by any means. It was definitely a huge plus for us. But from an objective point, it makes no sense at all.

I wonder if there is a "safe" limit or ceiling? I am interested to hear what your attorney says. For example, what if I was able to save 70k, instead of 7k, prior to the 341, for some reason.

Best,

-dmc

Yeah... in our district, we were able to claim both vehicle payments on the means test even though we were surrendering them, but we weren't able to claim them on schedule J. I am a little nervous about the fact that we claimed $130/month in car insurance. That IS what we have paid for our insurance, but now that we're dropping both new vehicles, I don't know how much it'll be - but it certainly won't be $130/month! Hopefully the TT won't question it too much.

I would LOVE to save $7K by the 341, but we'll most likely only have 2-3K saved.

One day when my mom moves out or gets a job (probably a year from now), we'll be able to save about 3-4K/month! That sure will be nice!

Thank you for your input

One of the Q's most TT's ask is "has anything changed in your situation since filing?" I would consider saving 70K in the 6 wks since filing, a "material change".

Other events that could impact the filing would be windfalls, like inheritance or lotto winning, or ??? These are typically a problem if before discharge, or if after disch and within 180 days of filing date of the Ch 7 bk. Outside 181 days is a non-starter, and pst disch, as I understand it.

Yeah, 70K would certainly seem like a "material change." Who knows though. I know our situation won't change except the obvious - our expenses dropped.

[blessed]

We're only able to save $200 a month right now. But that is more than we had in savings before!

AFAIK they only want to see the balances on all accounts the DAY you file. They'll make sure you didn't have more than the exempt amount of money. After that you can save as much as you want, minus a HUGE amount like lotto or inheritance.

[SMinGA]

Just wanted to add my 2 cents worth...

"Saving" does not always mean you have "extra" money. More like you might have extra some months, since you don't have the same expenses every month. Saving money in those good months is how you get thru the year with its ups & downs.

I asked our attorney about how to budget for schedule J/Means test if we were to decide to give up the house/mortgage. He said we'd then factor in an estimated rent/utilities based on the IRS standards. Seemed reasonable to me...

[coolmom04]

Just wanted to add my 2 cents worth...

"Saving" does not always mean you have "extra" money. More like you might have extra some months, since you don't have the same expenses every month. Saving money in those good months is how you get thru the year with its ups & downs.

I asked our attorney about how to budget for schedule J/Means test if we were to decide to give up the house/mortgage. He said we'd then factor in an estimated rent/utilities based on the IRS standards. Seemed reasonable to me...

Our "savings" is basically saving for the stuff we SHOULD have been budgeting for all these years - car repairs, clothes, tires, home maintenance, etc. We never had a penny in savings and then when we'd need things or have an emergency, we'd have to charge it. It'll be so nice to have some money in the savings account for those things now.

[brad10281]

After filing we weren't making a house, boat or truck payment. We were able to save about $1200/month plus we got a tax return of over $4k. One evening the repo man showed up at the door to take the truck. This was unexpected since I'm still waiting for my discharge, but according to my lawyer it was legal since I didn't sign a re-aff letter. Anyway, we had a little over $7k in savings and had to use that for a new car. We borrowed a few grand from a relative and now have a new (used) car fully paid off. i sure hope the bk court can't take it from us. I felt the same way though...I felt like taking it out of the bank and burrying it in the backyard!

[OutofTime]

Yeah this whole savings thing was one I was unable to grasp with all the bills and stealing from peter to pay paul with cc's. I feel weird having extra money after my bills are paid but you guys are right, this is what we should have been doing in the first place had we not had to get buried in debt. I definately have learned my lesson and will never take financial freedom for granted once I get through my bk.

[needanswers]

Wow, saving money is a concept I haven't done or even thought of, in forever!
Are you allowed to save money during a Ch. 13?

[nc73]

If I had a job I might save.

[coolmom04]

Yeah this whole savings thing was one I was unable to grasp with all the bills and stealing from peter to pay paul with cc's. I feel weird having extra money after my bills are paid but you guys are right, this is what we should have been doing in the first place had we not had to get buried in debt. I definately have learned my lesson and will never take financial freedom for granted once I get through my bk.

I couldn't agree more!!

Wow, saving money is a concept I haven't done or even thought of, in forever!
Are you allowed to save money during a Ch. 13?

I'm doing ch7, but I've read where a lot of people who filed ch.13 have been able to save b/c they had a well-padded budget!!

[keepmine]

Just wanted to add my 2 cents worth...

"Saving" does not always mean you have "extra" money. More like you might have extra some months, since you don't have the same expenses every month. Saving money in those good months is how you get thru the year with its ups & downs.

I asked our attorney about how to budget for schedule J/Means test if we were to decide to give up the house/mortgage. He said we'd then factor in an estimated rent/utilities based on the IRS standards. Seemed reasonable to me...

Good explanation. On my schedules, my lawyer broke down my expenses monthly but, since I pay my auto insurance semi annually, my ISP annually, newspaper subscription annually, and a few other things either annually or semi annually I have more money some months than others.
Factor in things like utilities that will be diferent every month and saving can be a rather fluid situation.
Just get into the habit of paying yourself something every month. Also, if you're not already doing it-be sure you and your spouse are contributing to a 401K at least up to the employer match. And, be sure you both {if you're working} have both long and shortterm disability insurance.

[ItsJustMe]

We started saving the minute we filed. We had kept the mortgage current so that it could be included for Means, but stopped paying as soon as we filed. We had $8K in savings at discharge. We are saving for a new place.

[dscurlock]

We started saving the minute we filed. We had kept the mortgage current so that it could be included for Means, but stopped paying as soon as we filed. We had $8K in savings at discharge. We are saving for a new place.

One day I hope to own my own mobile home...right now, I own the mobile, but still have to pay lot rent..land is so god awuful expensive where i live...and yes, I would rather have a mobile, then a house, for one its a lot
cheaper in the end...one day...