filed for chapter 13 today, need advice on how to spend/budget effectively?

[ATRochie]

filed for a chapter 13 today, and I am nervous about spending money leading up to trustee meeting, and also spending while in bankruptcy.

I currently pay my monthly bills with billpay using my checking account where our checks direct deposit into. We pay an in-home daycare in cash monthly. Everything else my wife and I pay for with debit cards of this checking account.

I have read that switching to mostly cash only can be a better way to control expenses. Is it okay to put leftover money in a savings account or is it better to just keep it in cash form in a safe at home? And how closely do I need to track my expenditures? Does EVERY receipt need to be saved moving forward?

If I don't follow the proposed budget to the letter (e.g. spend too much on groceries and make up for it by spending less on clothes during a month) does anyone pay attention to this stuff other than me?

If I need to make a large purchase, should I use cash? At this point I'm just nervous about spending any money in general.

Any advice would be greatly appreciated. Thanks.

[jange]

ATRochie, I have continued to used my debit card and bill pay for most of my bills. My paycheck is direct deposit into my account. None of that changed for me. You do need to save money, I had a very small saving account before filing and I still have the same account now, it just has more money in it.

The trustee is not going to manage your budget or even look at it beyond the 341 meeting. He will look at it there, but only to make sure you are not spending to much at the expense of the creditors. After that is up to you to manage. The budget that you set up is a probably good starting point as it should be made up of what you are spending but if you spend more or less on food or on clothes, in the end only you will know.

You do need to save money from your budget since something will happened and you will need to pay cash/debit card. Right after we filed, I had a major car repair and then the water heater went a few months later. They had to be fixed and since I had the money saved I was able to pay for them. The cost of things go up and you need to plan for that also.

I do not save my receipts, unless it is for my taxes. It does take a bit but you do get to a new normal and just continue to live your life, manage your money without credit cards etc and pay the trustee every month.

I just sent in 46/60 payments and looking forward to finishing.

[lillymarlene]

jange, that is great advice, that is basically how I've been living for the past 36 months. ATRochie, I see no need to convert my money, pittance really:-) into cash before I use it. Paychecks from my temp job are on direct deposit, and my self-employment income is directed into a debit card. It's old fashioned, but I still prefer to pay a lot of my bills by paper check. I usually check my balances daily.

[dmc-2008]

I dont save Any receipts either. I am kind of wishing i did because i am taking more meds that are not covered and they cost me and are bdget busters. Are u in 60 payment Plan? I just want company!

[BNKRPTinNC]

Have been using billpay and debit card throughout my entire bankruptcy. Same as cash IMO as you can only spend what you got. I made one large purchase and simply wrote a check. As for saving receipts, I saved nearly every one and will continue to do so as it makes me aware of where each and every penny is spent. But that's me. Although, it has come in handy when a warranty item comes up and I can lay my hands on the receipt which in the past got tossed. And much easier when it comes to tax time to not have go digging all over the house in search of proof for deductions.

As Jange mentioned, along some other sound advice, the trustee has no interest in how you manage your finances other than getting a monthly check and refunds if that is part of your plan. I have had zero contact with mine over the last 5 years other than an occasional statement has to how the funds were being disbursed. Hopefully, the next time I am contacted will be the final paperwork and a notice of discharge. (last payment made on Nov.1)

Best of luck to you.