Should I File Before Finding a New Job?

[joecon916]

Hello All, I swear that it's easier to get answers from here than getting a hold of my lawyer. I got laid off in January got a 6 month severance package where I get paid twice a month until August (paid the same amount as when I was employed). With that said, is it advisable to not look for work until unemployment kicks in so I will easily pass the means test? My concern is if I land a decent paying job (although very unlikely) and it is averaged with the last few months, I may be above the cut-off.

Also, I stopped paying all my CC and mortgage as of June 1st. With me still getting paid through severance and not paying my debts, I will be able to save about $9K by end of July. I am trying to save up as much cash I can in the event I need to find a place to live, HH expenses and other emergency. Is that OK or is that considered fraud?

Thanks!

[newbie2]

Hello All, I swear that it's easier to get answers from here than getting a hold of my lawyer. I got laid off in January got a 6 month severance package where I get paid twice a month until August (paid the same amount as when I was employed). With that said, is it advisable to not look for work until unemployment kicks in so I will easily pass the means test? My concern is if I land a decent paying job (although very unlikely) and it is averaged with the last few months, I may be above the cut-off.

Also, I stopped paying all my CC and mortgage as of June 1st. With me still getting paid through severance and not paying my debts, I will be able to save about $9K by end of July. I am trying to save up as much cash I can in the event I need to find a place to live, HH expenses and other emergency. Is that OK or is that considered fraud?

Thanks!

Only you can judge what you think the timetable will be as far as finding another job. Here in my state, it could be years for some people, and most would not be able to find another job with the same pay scale. Sit and crunch the numbers (severance pay months + unemployment pay months) to see what your average income will look like a month or two after your severance ends and go from there in making your decision on when to file.

As far as saving while you are waiting, that isn't fraudulent, but make sure that the money would be exempt when you do file. The last thing you want is to file and have the trustee want you to turn over the excess cash.

Good luck to you.

[HappyCatNC]

first, you need to find out what the "cutoff" is for your family size in your state. it will give you a guideline to work with. see how it would play out if you filed with your current income.

second, in this economy it seems foolish to wait for looking for a job. you know your area/market better than I do, of course, but that's something to consider.

finally, there is nothing wrong with saving up cash when you know your income is going to go away in a few months. just keep in mind you'll have to "use up" that cash prior to filing in a reasonable way or the trustee will just take it. by reasonable i mean a deposit on apartment or paying your car insurance in full for a year, not cash withdrawals or large purchases at best buy.