Cash in savings account
Hello – I have about $1800 in my chequing account that I have been saving for a trip. My wife and I probably have to claim bankruptcy soon. What should I do with this cash? If I pay down one of my credit cards, then it will show that I am giving preference. Should I just use it for groceries, gas, etc. because if I don’t, the trustee will take it? Thanks.
If you are going to withdraw the money and then file bankruptcy your trustee will request a detailed list of how you spent the money. If you intend to repay any of your creditors then you should make sure you make proportional payments to all of your creditors, as opposed to simply paying off one or two (as you said, if you paid off one or two creditors it would show a preference and their would be consequences in your bankruptcy).
If you have money in a savings account that is not required to pay the rent or purchase your basic necessities then you are correct, your trustee will seize those funds if you file bankruptcy.
If you simply withdraw the funds and cannot provide a detailed list of how you spent the money your trustee will likely make you pay an extra $1800 into your bankruptcy to cover the money you withdrew.
If you think that need to file bankruptcy then you should ask yourself if it is worth the lose of the $1800 in exchange for the elimination of all of your unsecured debt. Depending on how much you owe, it sounds like a small price to pay in comparison.