Using savings after filing...

[annamollie]

Sorry if this has been answered before, but I'm having trouble finding it.

Since everything I own, including my savings, is now considered to be a part of the bankruptcy estate, am I still allowed to use my savings? I know you can use it for everyday living expenses, but what about something unexpected? I filed an individual chapter 7, btw. The reason I'm asking is because my husband needs the money to pay a large bill and it's really going to impact the account. Can someone please fill me in on what's accepted and what's not?

I have enough exemptions to cover the amount. I just don't want to do something I'm not supposed to.

Thanks.

[SamanthaJones]

If that savings is part of the estate, then it is no longer yours.

If not, you exempted it, and it's yours. The estate is an entity all its own, made of nonexempt property.

[SinkingFast]

If not, you exempted it, and it's yours. The estate is an entity all its own, made of nonexempt property.

The Estate is ALL of the Debtor/Filer's property. The Trustee takes control of everything the Debtor/Filer owns. Some property and assets are Exempted and the Debtor/Filer will be able to keep those assets post BK.

I really don't know the "Law" here, AnnaMollie. If the cash is Exempt, it would seem you could use it. BUT, personally, while the BK was Open, I wouldn't unless my attny said it was OK to do so.

I'd strongly suggest you contact your attny and ask what you can and cannot do. If it's a necessity, it may be OK. If it's some other type Expense, it may not be OK. Or it may be totally fine to use the money because it is Exempted.

Better safe than sorry in BK. Call your attny and ask.

[HHM]

If it is exempt, then you can use it.

First off, what type of savings vehicle is this, is it simply a savings account, or are we talking about 401k, IRA, etc.

Second, what state are you in, and what exemption are you using. Did you file with a BK attorney or on your own. The only reason I ask is that, unless the amount were talking about is small, most states have a fairly insignificant cash exemption, or free-be exemption (assuming, of course, we are talking about money in a regular savings account), and don't allow you to transfer unused exemption amounts over to other asset classes.

In any event, assuming the cash is exempt, you best bet is to wait until after discharge...but if all you going to use it for is regular living expenses, no one is going to question your use.

[annamollie]

Thank you for the responses...

It is a money market savings account. I'm in Michigan, but I'm using Federal exemptions. I filed with a BK attorney and he says it's exempted, but he didn't explain how. I just assumed he was using the unused homestead.

If it helps... He filed my savings account info as having $3000 ($1500 mine since it's individual), but there was only $2000 in the account on filing day.

The truth of the matter is that my husband is upset that he can't use the money...for whatever reason. It's not urgent that we use it. I just don't like the fact that MY problem has to involve him.

[HHM]

You should be fine. I don't think you would have any problem using it and it would not be an issue.

[annamollie]

You should be fine. I don't think you would have any problem using it and it would not be an issue.

Thank you.