Hello this is bankruptcy attorney Jeff Kelly and Today is April the 24th 2020. Yesterday Bloomberg reported that major credit card companies are lowering credit limits because of this Corona outbreak. And what I want to talk about today in this podcast is why it is so important that you establish an emergency fund of cash for your family and not rely on a credit card to get you through rough times. I’ve heard many many clients say over the years that you know we’re that are filing Chapter 7 wiping out the debts we’re getting them a fresh start, and people will say I just cannot lose my credit card because I need the credit card.
In case of an emergency, and that is a wrong way of thinking, in my opinion. What you need is cash in case of an emergency. Because if you’re relying on a credit card to help get you through a rough time, what are you going to do when the credit card company cuts your limit off and you can no longer use it? Credit cards are not and should never be considered your emergency plan the sole basis of your emergency plan, you need cash. So as we’re going through this tough time here, there are 26 million people who are unemployed today through no fault of their own because of this Coronavirus quarantine.
So, what should a person do who has zero dollars in their emergency fund right now? Well, my advice is, as you do get your as you do get your hands on cash via unemployment payments or working part-time, whatever the sources save that money. I think an average family needs a minimum of about $5,000 in their savings account for an emergency fund. So does it make sense to pay credit card companies the minimum payments when you have no cash? It doesn’t make sense to drain your savings down to zero to make minimum payments on your credit cards? Absolutely not. That makes no sense. You’ve got to be able to have enough money for emergency food for your your utilities. So during this emergency time, food and utilities have to be number one. You’ve got to have money the setback for medicine for your family.
The next line of importance is going to be rent or your mortgage payments. Now, I talked to a lot of clients and honestly, most of us make, including myself, we make a lot of major financial decisions based on emotion. And when you are going through a tough time if you’re unemployed, you have got to throw emotion out the window because the math has to work. Math trumps everything. It makes no mathematical sense to take your desperately needed cash to pay towards debt that you’re most likely going to end up wiping out and eliminating. In a bankruptcy case. If things get bad enough, you have to eat, you have to pay the electricity, you’ve got to pay rent, you’ve got to pay mortgage if you’re getting into a city Were rent and mortgages are not getting paid and things are heading south, then you have to come up with a new plan. There’s got to be a backup plan. And I know a lot of people aren’t going to want to hear this. But, you know, I remember back in the 2008 crisis, I saw a lot of families living in one house, there were quite a few cases where there were three generations in one house. And I hope it doesn’t come to that I hope we have a a fast recovery and people are able to get back to work. But you know, worst comes to worse, we may be seeing a lot of that happen again. And we will get through it just like we got through the last crisis.
It’s very, very important that even as you deal with all this stress, and you know, dealing with the frustration, somehow you got to maintain a positive attitude, you got to stay positive, you got to keep your head up. We’ve got to march forward is the only way we’re going to get through it. And together we can. We are here to help.
If you would like to take advantage of a free consultation, we’ll be happy to talk to you go through your income and your budget and we’ll be more than happy to give you our two cents worth. You can call us at 770-881-8449. More thing I want to mention real quick. Also is community it is very important that you are not isolated as you’re going through a tough economic time. Reach out to family. Don’t if you’re suffering and the math isn’t working. You got to tell people you got to tell your family. You’re not supposed to go through tough times all by yourself. If you don’t have family close by, I advise people you know Reach out to your church. If you don’t have a church, find one, call one. Personally, I go to First Presbyterian, and downtown Rome. It’s a great church. pastors are a wonderful, fantastic resource for life wisdom, they, they help a lot of people get through tough times. And I strongly believe that as we go through this recovery, we’re going to have to lean on each other. We’re going to have to lean on family, we’re going to have to lean on, on churches. But whatever you do, don’t. Don’t be isolated.
If If you want to learn more about chapter 13 and chapter 7, I have written a book on it and I would like to get you a free copy. So go to my main website, www.kellycanhelp.com scroll down to the bottom. Type in your email address and we will get you a copy delivered to your inbox. If you prefer hardcopy. We’ll be happy to mail you one while supplies last. You can reach us at 770-881-8449. Thank you for tuning in today. Have a good one.
Here is a link to the article I refer to in this podcast.
Welcome to the first radio show with Jeff Kelly featuring guest Patrick Matson. Today we debunk the fears surrounding bankruptcy and ensuring that your bankruptcy experience is one that goes smoothly. ...
Hello, this is Jeff Kelly. And in this podcast today, I’m going to talk about what happens to your credit score after bankruptcy. Am I doomed? For many years. What does my future look like? Will I ever be able to buy a new car at a decent interest rate? Will I ever be able to buy that house that I’ve always dreamed of? Is my financial future ruined forever as a bankruptcy attorney who has practiced in this area since 1998? I have heard questions like these hundreds of times. And the answer might shock you. The answer is this. Most people do recover within about two years, one to two years of filing Chapter 7 bankruptcy. How can that possibly be? You may say, well, first of all, usually by the time the clients come meet with me, the damage has already been done. Most potential clients have stopped paying credit cards. Many months ago, had cars repossessed. Been sued by creditors. Had wages garnished or had their house foreclosed. Any of these will put a major hit to your credit rating. For most people considering bankruptcy, like I said, the damage is already there. So the question is, what do we want to do going forward? Do you ever get a knot in your stomach when you think about your credit score? David, just feel sick to your stomach thinking about all that debt and the interest and late fees and just mess that’s hanging over you and it’s not going anywhere. Well, Chapter 7 might help make that pain ...
Hello, this is Jeff Kelly and Today is June the 15th 2020. And today I want to talk about how to protect yourself from theft in a chapter 13 with NDC.org. Every active chapter 13 debtor should open an account with NDC.org, the cost is free, but the information you see could be worth a lot of money and save you from theft. Having an account with NDC.org will allow you to see every single proof of claim that has been filed in your bankruptcy case and it will also allow you to verify that your chapter 13 payments are being received by the trustee. Years ago I had a client whose employer took money from her paycheck, but never sent it into the trustee. We caught the error and had to sue the employer to get the money paid. Having an account with NDC.org allows you to catch stuff like this. Proof of claim is a form signed under oath, with supporting documentation that a creditor must file in a bankruptcy case in order to get paid. The proof of claim will tell the trustee the type of claim and the amount owed. If a creditor fails to file before the deadline in your case, they won’t get paid anything. For example, let’s say you had a car repossessed a few years ago, and owe the car creditor $10,000. If they fail to file a proof of claim on time, you will not have to pay that $10,000. Let’s change up the facts ...