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What to do with cash $$$ before filing?

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    What to do with cash $$$ before filing?

    My debt is piling up rapidly due to an emergency. I am in the early stages of considering Ch. 13.

    I have approx $14k in cash savings, mutal funds, etc. on hand (not enough to get me out of my predicament, of course). What is best to do with it?

    I am afraid it is low hanging fruit to be swiped up by a trustee.

    I live in Louisiana - no wild card exemption, $35k property exemption.

    I was considering just putting it all toward student loans, since they would need to be repaid no matter what? Can I stick it under my mattress??

    Thanks for any advice.

    #2
    The lookback period for preferential payments to a non-insider (such as your student loan company) would be 90 days. If you pay them more than $600 within 90 days of filing, the trustee could potentially "claw back" that money. Of course, there is an easy solution: spend down your non-exempt funds paying toward the student loans, then wait a good 3-4 months (or more to be extra safe) before you declare bankruptcy. Also, unless you have property backed by a secured loan, which you need to bring current, I'd try to file for Chapter 7 rather than 13 if at all possible.

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      #3
      bcohen answered your other questions...

      Originally posted by Bureaukrat View Post
      Can I stick it under my mattress??
      Yes, you could stick it in a mattress, a jar, a pair of used boots. You would, however, still need to disclose that you have "cash on hand" (not in a depository account). So it serves no real purpose to stuff money in the mattress since you would still need to disclose that cash.

      How about seeing if IRAs or other retirement accounts are protected in your State. Maybe put a little away in such an account? The student loan paydown may be a better suggestion.

      Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
      Status: (Auto) Discharged and Closed! 5/10
      Visit My BKForum Blog: justbroke's Blog


      I am not an attorney. Any advice provided is not legal advice.

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