Judge confirmed plan!

[hopeforbetter62]

Hello all. I had posted earlier because the trustee in my case objected my confirmation but IT WAS CONFIRMED this past Wednesday by the judge! Now I just have to focus on budgeting and making it work. How does everyone do their day-to-day budgeting on a Chapter 13?

[qwertysue]

I have my budget planned out 3 months at a time.

We use a modified envelope plan. We use debit card/checking for bills only. Everything else gets doled out into envelopes: Grocery money, gas money, *house money*, etc. All those are cash only.

We use only what is in that specific envelope. If there is anything left over, it goes into savings. Just because it's there doesn't mean that we have to spend it. If I have $100.00 alloted for the weeks groceries and I only use $75, then the $25 goes into savings. I've found myself making wiser decisions knowing that my envelope money is all there is. I've put back many a magazine or other crap because I didn't have the cash.

[wayne-o]

the envelope system works well. One thing I did with my utilities was put them on budget billing where my payment is basically the same each month. Im not paying any less, but my gas bill doesnt jump lots in the winter.

[lrprn]

The important thing is to make your budget fit within the income and expenses you have.

Here are several good budgeting workplans to start with -

http://cgi.money.cnn.com/tools/budget101/budget_101.jsp

http://finance.yahoo.com/v4

http://www.kiplinger.com/tools/budget/

Another valuable exercise is to go back and capture as much of what you've spent in the last few months as possible, then start writing down EVERYTHING you spend for the next 1-2 months. Every single penny. Find out where your money is going. and how much you are spending, especially where your cash is going. After doing this, you'll have a very good sense of your spending patterns between your set bills, purchases you have to make but can control somewhat (groceries and eating out, for example), and your voluntary purchases.

Surviving Ch 13 is all about living inside the budget. When you spend more in one category one month, that extra has to come out of another category that month. It's all about the bottom line - overall income minus overall expenses. The goal is to make that come out as positive as possible.

The most important thing you can do at the start of Ch 13 is to keep your discretionary spending to an absolute minimum to build up some emergency surplus you can put aside to cover those emergencies when they do happen (notice I said when, not if). Hopefully your confirmed plan is realistic with a bit of "wiggle room" and isn't one that is so unrealistically tight that you are almost guaranteed to fail over time.

I keep our family finances in Quicken - others here use Microsoft Money, Excel spreadsheets they create themselves, use the envelope system (already mentioned), or write down everything manually in a notebook.

How you keep track of family spending and bill paying doesn't matter as much as finding a method that works for you, is relatively easy to use, allows you to see how you are doing against your budget at any given time during the month, and will continue to work for years to come.

You never want to find yourself in a situation where you can't pay your monthly trustee payment or don't have enough money to make it to the next paycheck. The best way to do that is almost obsessively track spending against your budget and keep doing so until your Ch 13 is discharged.