Sometimes debt can get to the point where making payments doesn’t allow you to make much of a dent on the balance owed, and this can be crippling to investing in your financial future. While bankruptcy is not without consequences, sometimes the negative results are worth the relief of reducing your debt and making a new start. Once you’ve decided that bankruptcy might be the best option for you, there are some other decisions you must make and steps you’ll need to take. Working with an experienced bankruptcy attorney can help you to avoid any of the common mistakes that could damage your overall financial situation. I’m here to guide you through the process and ensure things go smoothly.
Creating Your Budget
One of the most important things any of us can do is to track our monthly spending and create a realistic budget. This way you’ll know exactly where your money is going so that you can make informed decisions; having a documented budget is also a requirement for filing bankruptcy. I’ll give you a template and list of possible expenses to help you ensure that nothing is omitted. It’s usually easy to list monthly expenses that do not change, such as rent/mortgage, phone, insurance, etc., but adding variable expenses can be more challenging. What you spend on food, gas, and entertainment can change from month to month, and these are also good places to cut spending, if necessary. As you build your budget, you’ll also need to account for intermittent and annual expenses, such as gifts, clothing, school supplies, registrations, and memberships. If possible, also plan for building up an emergency fund or savings account.
Once your budget is settled, there is additional paperwork to be completed and compiled before we can get your case filed. You’ll need copies of all of your bills and statements showing the balance owed, including medical bills, credit cards, utilities, and any loans you’re responsible for, such as auto or student loans. These bills will need to go back for three months, and you’ll also need to show proof of income for the three months prior to filing. Most people are able to provide paystubs, but if you’re self-employed, you’ll need to use alternatives, such as invoices or bank statements. You may use award letters or court orders if you have other sources of income, such as child support or disability income. The court will also want to see your tax returns for the last three years.
To get a complete picture of your financial situation, you’ll need to show documents supporting your assets, such as investment account statements, insurance policies, vehicle titles, and mortgage paperwork. The court will also want to see any legal documents pertaining to lawsuits filed against you, accounts sent to collections, divorce decrees, and orders to make alimony or child support payments.
A Customized Plan
No two lives or financial situations are alike, so we’ll work together to build a case that correctly represents your specific circumstances. I’m always available to answer any questions that come up and to offer my professional advice, so you can be confident that your bankruptcy will set you up for a more successful financial future.