Not Sure What I am Going to Do--Yet

I met with the lawyer on the 5th concerning bankruptcy. As of yet I haven't made a decision as to what to do. A few things surrounding the initiation of bankruptcy has changed which has complicated my decision. I'm really not sure what direction to go, so for now I am staying the course and working on a budget based on 2 incomes.

One thing I have decided is that I'm not going to worry about my debts as most of them are close to 7 yrs old. My medical debts are another story but I do have a plan which I will mention in a bit.

My first priority will be to make sure that my current living expenses are taken care of; included in that will be my student loan payment. Since bankruptcy will not remove a federally backed student loan, I am "stuck" with it.*

Next on my list will be to amass an emergency fund of some sort. Currently I have a small portfolio with Sharebuilders. The original idea behind these investments was just that. Al tho not easily assessable the money accumulated could be used if needed. As of now I'm going to continue (with my original plan) and with my current contribution of $20/mth with my initial goal of $550 saved/invested. After which I would/could sell off $500 of my holdings to either pay debt or put in a savings account (possibly ING). Since I am only half way toward my $550 goal I will continue to evaluate the best course of action. As I am continuously reading and learning, I am hoping to come up with the best choice for this money.**

As for my "other" debts. Disregarding my budget for the moment I am going to do nothing. I do not mean I am going to bury my head in the sand again, but until I get some type of cushion/emergency fund in place my thinking is --what good is paying off debt if I just end up back in debt due to some type of money issue. Is my thinking flawed? If I understand the gurus correctly that is the direction I need to go; build emergency fund first, tackle debts second.***

My budget--I believe I have finally produced a proper budget with both fixed and variable expenses included. After much reading I realized that my past budgets were not thorough enough. That, I believe may be part of my financial problems. It is with hopes that if this budget is accurate I will be able to make monthly payments on my debt(s).

Overall I am going to keep things simple--work as many hours as humanly possible without killing myself; make sure current living expenses taken care of; pay on student loan (continue to work with agency handling loan to try and get payment lowered); continue $20 contribution to Sharebuilders whilst looking for another options for and emergency fund; stick to budget using cash only for purchases; take care of the one debt that has other issues attached to it; re-evaluate bankruptcy decision.

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*(Please note that in extreme financial situations a student loan may be discharged but it is very rare. Based on what I read, your income would have to be at or below the federal poverty level with other criteria also being met. The guidelines are very rigid as you would be asking the government to forgive their own debt.)

**I initially chose this route to start an emergency fund due to the fact that I can not save money. If I have any access to the funds they will be used. I would love to say that the money would be used wisely, but that is not always the case. I did consider and ING account at the time but I do not remember why I did not go that route. The Sharebuilders account seems to be working out OK and I am making some dividends.

***There is one debt that I do need to pay on during this process, but there are some other issues that will figure in to how I handle this. It is with hope that my new budget will allow the flexibility to handle this debt properly.

What I have to bring to consultation meeting

This is a list of financial information I will have to bring to my first meeting with my lawyer:

• last 6 months of pay stubs--note to self: call plant 5/1/08-10/31/08
• last 4 yrs taxes with w-2 forms--2007, 2006, 2005, 2004
1. 2004-complete with W-2s
2. 2005--complete with W-2s
3. 2006--have W-2s missing filing copy
4. 2007--complete with W-2s
• last 12 months bank statements--on-line, need to be downloaded and printed
• 401K info--on-line, ready to print if can't find my copies
• investment info--on-line, have to download info yet
• all current and past due bills/debts to include in bankruptcy--what a mess; have all info gathered save a few. I have some zombie debts that I assume are still floating around in collections but I haven't received any contact from agencies in years. Not sure if I should dig these up myself, or let the lawyer do it.
• any shut-off notices--none, altho I think I have one coming

So over the course of the next few days/weeks I will be attempting to collect this information.

UPDATED: 11/17/08

Declaring Bankruptcy

It is with regret that I have to write on this topic but I an waving the white flag. My phone starts ringing at 830 AM and does not stop till 9 PM. On average I have 15-18 collection calls per day, all of which go unanswered. The last straw is the situation with my student loans. I take the blame for it all. So today I made the call to set up a consultation. On December 1st I will meet with the lawyer.

I am 44 years old, I make about $26,000 working 72 hrs per week between two jobs. I am over $70,000 in debt (that does not include debts over 7 yrs old). Physically my body is breaking down affecting my ability to continue working two jobs. I do not qualify for social security disability; not an option I would consider. I live in an economically depressed area with low job options (don't we all); county population under 6,000. Moving is not an option at this time, my partner's family is here mine are within a 3 hour drive. I do not spend my money on material things per se, alt ho I have been known to have a manic spending sprees on un-important stuff (I am bipolar and it does affect my ability to handle money, I make poor decisions at times but have been getting better with this.) Overall I am overwhelmed and hanging by a string.

As depressing as this all sounds I am still willing to push on. I have no choice, I alone am responsible for this financial mess. Some days I can see the light at the end of the tunnel, others days, I need a rope. Bankruptcy is my rope.

I know that some people will be disappointed with the path that I am choosing. There are many other variables that factor into this decision; I would need much time to explain it all in a sensible manner. Please realize that I do not make this decision lightly. I do understand the consequences of this choice.

So what does this all mean? To be honest I don't know. My plan is to continue blogging. I find it cathartic. I will posting on the process I have to go through as I feel it would be enlightening, not only for myself but others too. I will continue to learn how to be frugal and save money.

So with that said I will start my journey with open eyes regardless of the outcome. To help me stay focused and organized I will be posting everything concerning the process I have to go through. It may not be the most interesting content but we shall see. I would love to here from others that have been in the same situation. Any insights would be appreciated.