Do you ever look back and wished that you had spent MORE moeny before BK?

[JackBondLove]

I was just thinking ... I'm looking at the stuff I had, and some stuff I want to buy. Some of the stuff I had bought was bought with some questioning (i.e. should I have bought it, or at least paid what I paid for it, etc.), and there is stuff I want to buy now that I had thought about buying back then, that if I had bought it back then, I would have the stuff, and simply would have lasted a month or two less before zeroing out my bank account (or at least zeroing out to the point of the last chance stuff to buy before BK - e.g., my home, necessary appliances, etc. - that were exempt, etc.) and stopped paying on my debts. Since even the non-exempt stuff had a very low valuation (i.e., that was necessary to pay back to the trustee to buy it back), in hindsight, it seems that it would have made a lot of sense for me to just have bought all this stuff then. (Of course, I did buy a lot of stuff in any case - some stuff quite fortuitously in hindsight, like my grand piano that ended up being exempt!)

Anyway, I know every case is different, and it might seem a bit unethical to think in this way, but the facts are that any stuff we had bought before (except for something like a home or car) we got to more or less keep without paying for it. Had we bought more stuff, we would have more stuff now.

Or I am just being incredibly cynical (or even evil!)?

[Freddy03]

Absolutely NOT!

Some of your posts amaze me. Are you serious about "forgetting" to tell the mortgage broker you filed BK or being so quick to apply for over 25 credit card applications? And now wishing that you bought more stuff before you filed BK??

[JackBondLove]

I'm wondering if a CEO who took out a golden parachute before his company tanked ever wished that he had extracted out even more. Wouldn't this be a very similar ethical situation?

[JackBondLove]

Absolutely NOT!

Some of your posts amaze me. Are you serious about "forgetting" to tell the mortgage broker you filed BK or being so quick to apply for over 25 credit card applications? And now wishing that you bought more stuff before you filed BK??

Like I said ... thinking from a very cynical POV! Isn't the whole idea of BK, while exempting assets just as cynical? Shouldn't I feel just as guilty for not taking the collector's "advice" of distributing my IRA to pay him off? What's the ethical difference here?

[AZNoName]

I've been married 10 years and bought a K-mart bedroom set with our wedding money. Part of me wishes I purchased one YEARS ago!, and again before I filed, but the way things were timed:
1. It would have been an obvious 'intent to not pay', and
2. The more furniture and stuff you buy, the more non-exempt assets you have...

Oh well, my particle board K-mart bed will have to last another 5 years I guess! lol.

Years ago I heard of people running out and charging up a storm before they file. It seemed so acceptable somehow. They think they're so clever. I was just too plain scared to do that. When BK is your only option, why chance it?

If I had more time before filing, I may have done things a little differently. I should have traded in my husbands paid-off truck and financed something with lower miles and get the vehicle exemption. I may have bought a couple new tires for my car perhaps. Nothing extravagant. No watches or jewels. Just stuff to get me through the next 5 years.

[kornellred]

The truth of the matter is that "bankruptcy planning", per se, involves some degree of rationalization. When you need to rationalize your behavior, it is more than likely that you are doing things that should not normally be done. I am almost at the end of my 5 year Chapter 13, which is my 2nd bankruptcy. What does that tell you? It's been a virtual cake walk for me, and I have managed to spend 100 thousand dollars that I never earned and will never pay back. Did I do that on purpose? Nah........not me....I'm as honest as the day is long. Honest to a fault, even.

[AngelinaCatHub]

JBL, my friend, you know we don't agree on a lot, but since I enjoy your posts, let me extend my opinion: Your thoughts are totally human and we who have been there have also thought of this. Far be it, that you or I would do what is loosely called an orchestrated bankruptcy. Totally wrong and also illegal. I lost all of my retirement (401k) attempting to do the "right thing". It was wrong at that time but I know squat about all this. I lost my aaaiizze over this thing but as ignorant as we were, we feel justified, and honest and free.

The part of honest is very important, and you have to live with yourself. Character is very important as when you leave this realm, and we all will, the money, or no money left behind means nothing. Your character goes on in respect of self, and with the respect others have for you when you leave.

You do not have larceny in your heart. You have hind site like all of us. That is all. 'Hub

[justbroke]

I'm wondering if a CEO who took out a golden parachute before his company tanked ever wished that he had extracted out even more. Wouldn't this be a very similar ethical situation?

No. A golden parachute is a specific legal contractual obligation of the employer. Of course the ex-CEO can wish he signed a better contract. That's much different than gaming.

Now, if the CEO fudged numbers to get a higher bonus... now we are in the same ballpark!

Unfortunately, most of us never even considered or understood what Bankruptcy pre-planning is. It is a process in which many wealthy individuals are actually able to shelter lots of their wealth (net worth) by using the system -- within the law. Florida is a perfect example. There are so many multi-millionaires (and billionaires) that own property here, it's astounding! That's thanks to the unlimited homestead exemption. Nothing wrong with taking your golden parachute of say $100M, buying a nice Intercoastal or Ocean-side home in Boca Raton for $99.9M and then declaring bankruptcy!

I don't think that is cynical at all.

[lillymarlene]

Sure, I would like to have spent a little more before bankruptcy, but like many people, I had no idea that bankruptcy could be pre-planned. Then six months before I filed, most of my credit cards had been closed, or the limits had been cut to about $100 above the balances. Of course if I had known, rather than try to pay unsecured loans, I would have tended to some exempt things like car repair, a new winter coat, house repairs and stocked up on canned goods, etc...the list goes on. :-)

[spidge]

We are in a Ch13 and I would have liked to buy a truck, but I sure like the plan I am in with no car payments and a chance to save.

[andy158]

Only thing I wish we bought was a newer or same year car with less miles. We did get our car crammed down in our plan to 1/2 of what we owed on it and that was a big help. It will be totally worthless in 2 1/2 more years. Just turned 170,000 miles!

Do you remember when the average car costs were about 10% of one's income? Now it is nearly 50%!

[Resigned2BK]

As far as the actual spending goes, I have no regrets. Our BK is due about 90% to DH making poor business decisions that might have not killed us if the economy continued to boom and about 10% due to me losing my job over 4 years ago and not being able to get a solid income ever since. I thought about this earlier today about spending. We've maintained a lot of frugality in our regular living ways and I was very frugal before I met DH, but I did take a couple of trips overseas about a year before we met and am so glad I did and didn't just try to keep saving and saving all that time. That money would've been lost eventually. It wouldn't have saved us from the BK we have to do now (we have a ridiculous amount of debt) and would've just gone into the black hole of trying to save a house that couldn't be saved or something else to delay the inevitable.

We actually find that we are spending a lot right now on eating out, last minute car repairs, stuff to winterize the house, etc because WA state allows so little an exemption for cash on hand that we might as well spend it than have the worthless creditors get it all in a couple months. It feels weird to spend money and not be constantly thinking very hard about if we should because it's just how we've been forced to live for so many years, but at the same time it's nice to be able to buy food and eat out and not have guilt about that.

[AngelinaCatHub]

My biggest regret was not realizing how deep I was in and tossed exempt monies at my debts. My honor was to pay my rightful debts yet, once I realized I could not, I threw away thousands of dollars. Once I did realize, it was too late. I would NEVER plan to spend a dime on another person's money within intent not to pay them back. I don't care how exempt the needs or items were, it is still stealing, plain and simple. 'Hub

[mountanddo]

There a a lot of people that max out their credit cards before they file bankruptcy. They just time it correctly. Is it legal? yes. Do they get away with it? yes if it is done right. Is is moral or ethical? Nope, but those people that do that don't really have a lot of morals. You have to decide for you what you are willing to live with and what chances you take. Most people that try to beat the system from watching others fail miserably and then end up paying the price.

[AngelinaCatHub]

There a a lot of people that max out their credit cards before they file bankruptcy. They just time it correctly. Is it legal? yes. Do they get away with it? yes if it is done right. Is is moral or ethical? Nope, but those people that do that don't really have a lot of morals. You have to decide for you what you are willing to live with and what chances you take. Most people that try to beat the system from watching others fail miserably and then end up paying the price.

Yes, and instead of collectors haunting them day and night, something worse may. Their conscience. During the Great Depression (no the other one), my grandfather went on the rails to find work and send the money home to his family. He lost his house but the bank allowed him to stay in it for two years. I don't think he ever bankrupted, but once he got onto his feet, he paid that mortgage off to the penny even though he could not reclaim the house. That is called Character. 'Hub.