How do you budget??

[bckthuzs]

I am going to speak with an attorney this week and I was wondering what do you figure in on a budget. I want to make sure I don't leave anything out to where it will hurt us down the road. Do they say anything about having a cell phone? Any responses would be greatly appreciated Thank you.

[bkfiler]

this link for the expense calculator will pretty much cover it.

http://www.ca-bankruptcy-attorneys.com/calculators/expense_calculator.html

also, look through your checkbook as well as online bank statements. dont leave anything out.

[Jman30]

Beyond what the court allows for expenses, there isn't much budgeting you can do, initially. You need to find that they allow for expenses, look at how much you have left and budget within that or start getting rid of stuff, like the cell phone.

[SinkingFast]

Different attnys will allow different amounts for things. Attnys will know what they can and cannot show to the Court in the way of routine expenses.

One attny we saw took our list and worked on our expenses. He said we paid more for auto insurance than the Court was used to seeing so he "adjusted" the expense. He did that with several expenses.

I didn't know what to put for Dry Cleaning and Laundry. I don't track how much I spend for detergent, and other laundry supplies. I do know I take stuff to the cleaners 1x or 2x a year (big trips) and I usually spend about $125-$150/year. So I wrote down $15/mo. The attny jacked that to $45/mo. That's a figure the Court was used to seeing.

That same attny wouldn't give us the entire amount of our cell phone bill. Even tho it's a legit expense under the New Law. Other attnys, however, have allowed the entire amount. They have also adjusted other expenses differently than that attny allowed. Maybe it has to do with the type of relationship each attny has with the Trustee and/or Court?? I dunno.

I'd suggest you go thru and make a list of the expense categories and write down what you do know. As time goes by you may remember things that will change the $/mo of a certain category.

Before we went for our first Consult, I made a list of $ amounts and expenses. I wrote down $75 for medical. I don't keep track of that stuff. I pay the bills and move on. So, I took our deductible, added one doc visit copay/mo, and our outa pocket costs for the 2 scripts I'm on. $75. Since then, I've remembered things. We had an ER visit that cost us $300 outa pocket. 2 children have seen the eye doctor this year with outa pockets both times. One child has to have contacts and glasses as the child is practically legally blind. One child had oral surgery with outa pocket there. This is 2 years in a row we've done the wisdom teeth thing, and we still have one left to go. We paid for 2 school physicals that insurance does not cover. Everybody in the family got flu shots. We buy over the counter meds that we keep on hand at home. Not to mention bandages, antibiotic ointments, etc. I considered those things medical instead of miscellaneous. I bought a Home Blood Pressure monitoring device. So I've boosted our medicals expense to $200/mo.

Write down everything you can think of. The attnys will take your list of expenses and adjust as they see fit for what they think the Court will or won't allow in your BK petition.

[bckthuzs]

Thanks, you guys give alot of good advice. I just don't want to sound like we are way out of our means when figuring. But you have listed alot of things that you don't think of. Thank you

[SinkingFast]

I wouldn't have thought of firewood except for BKFiler's little calculator link. Be sure and look at that website. It's a handy tool.

I'm having real trouble with Entertainment, myself.

[bkfiler]

remember these things about a budget:

- remember that when budgeting for the court do not try to be a hero and prove you can live cheap. let the attorney change the numbers to fit what the court would allow. but if he does so then make sure he didnt list it as a mitake when you assumed he did it to make it look better.

- remember that there are certain categories that raise red flags. entertainment is one of these. most courts get pissy about it when its obove $100 a month. your attorney will know. but i cant tell you how many court trials ive read where the ut trustee complains about that category.

- remember that you DO NOT want to make a perfect little budget such that you come up within -$50 or +$50 within your income. what happens if your trustee or US trustee goes to reject some of your expenses? yes it does happen and you do not want to be in a position to go from -$50 and have your entertainment or cell phone or cable bill or food bill or laundry bill or all of them hacked and wacked down such that you will end up with +115 for the month. this can and does happen. dont take the chance.

- how to avoid this? make sure you list every single thing. make sure you can come up with a -$ negative income. mine was negative in the hundred. and it was several hundred as a matter of fact.

- this is the way for them to force you into a chapter 13.

- ok so you think you can come up with more expenses latter on to show the court you cant afford it. adding expenses after the fact to help your side take all of your credibility away. the judges speak to this day in and day out in cases. as soon as you make changes to you case - which you will have to do if this happens to you or you will be forced into a chapter 13 - you will have lost your standing with the court and they are less likley to side with you. from then on their viewpoint is that you are changing things to cover your ass. and they are right even if you did leave something out it makes you look very bad.

- make sure you can prove every expense to the court. if you cant prove that the amount listed is correct then you are going to loose credibility with the court and might be dismissd or forced into a chapter 13.

- also know that a lot of times they muck and whine about the expenses when they see 'issues' with the credit card balances. cash advances, gambling, charges too soon from the date of filing, etc. they hold this over your head and complain about the expenses at the same time. its like a carrot in which they hope you will just convert instead of trying to fight a two or three pronged approach.

lessons learned: dont be caught lying on your application and make sure you list everysingle thing. check your account statements, look through receipts, search online for expenses otehr have used, look at checkbook, walk around the house and ask yourself if each and every item you and looking at is paid for with money listed someplace on the form.

are batteries for the remote controls listed?

is catnip, flea medicine and litter liner bags listed? annual vet appts listed?

paper and ink for the printer listed?

oil and filters, fuel injection clearner, estimated repair costs, tires, windshield wipers and AAA for the car listed?

newspaper listed?

cleaning supplies and home depot items for repair listed?

walk around at look at each and every single item and ask yourself - where did i list that on my form. on your own form list every single thing. on the actual forms list things in clumped togetheer categories. you dont want to have to show what you are trying to claim as an expense. its easier to deny.

also remember that the reason people fail their chapter 13 plans is becuse they cant come up with the money for these everyday things since they forgot to list them all in their budget. it only takes $50 a month more then you have to screw you for 3 to 5 years.

[Anj]

My budget turned out really well actually - I am very pleased "so far" - I asked for 40/month in clothing and was given 100 - I didn't ask for laundry and got 80/month - and then I got 75 "misc" on top of my 150/month entertainment.

BK is right - don't try to be a hero... live realistically. I would rather pump an extra year out of this than risk not making it through 1 KWIM?

We are in our first official month of this long haul - and let me tell you... it feels good. I've paid all my bills and have a couple of hundred left in the bank. The difference between now and 3 months ago is that I would only have a couple hundred left and my mortgage due... to go to bed and night and know that my bills are paid - that is peace enough...

Back to the budget - try and get on "budget" billing for your utilities so you get the same bill every month. That helps me... Remember things like taxes that you pay out of pocket (a MO thing- don't know about others) for vehicles and such - remember your Home association dues if you live in a subdivision that has those (we do and they included them).

GL - A

[bkfiler]

BK is right - don't try to be a hero... live realistically.

i agree!