Changing Your Lifestyle after Income Reduction
Sometimes Debtors are used to living a certain lifestyle, and then they have a reduction in pay. It is hard for them to understand that they cannot continue on with their current lifestyle based on the reduced income coming in. Debtors keep thinking something will change or they will get caught up next month, in the meantime they are robbing Peter to pay Paul. This kind of “budgeting” will never allow a Debtor to get caught up, but will only cause them to continue to fall further and further behind.
I meet with many Debtors and go over their income and budget. Once it is all on paper it makes it easier to see that their expenses are more than the money they are bringing in. Then on top of that, if they have filed a Chapter 13 bankruptcy they have to make a Trustee payment. Usually when Debtors come to my office, they aren’t ready to give anything up, but after about 6 months of struggling to make ends meet and falling behind again, they realize they need to surrender either a house or a car.
Not all Debtors have to give something up. Sometimes they have fallen behind due to a temporary loss of income or increase expenses for medical bills. However, if there is no hope of increasing your income or decreasing your expenses, filing a Chapter 13 bankruptcy and not surrendering something usually cause a Debtor to start falling behind on bills again.
Please fill out our free evaluation form to determine if bankruptcy is right for you.
