By law, Chapter 13 cases must last a minimum of 3 years, although many of the Chapter 13 cases we file will end up lasting 5 years.

It is hard enough to prepare a budget for the next six months – how can anyone possibly predict 5 years into the future?  There is no absolute answer to this – here is how we approach this problem:

• the Bankruptcy Code does allow us to file an amended budget.  If your income goes down, or goes up, we can revisit your case and change your plan.  Generally it is more difficult if you want to reduce your plan payment – we will have to appear before your judge to explain why your plan payment needs to decrease.
• when calculating a budget, we try to identify expenses that you know you will have.  For example, if you know that you will need a $3,000 dental surgery within the next year, we can build that cost into your monthly medical budget.   Car maintenance issues like new tires, 100,000 mile service, etc. can also be planned.  You may need to gather documentation for these future expenses, but a little work on the front end can make your plan a lot more livable.
• you need to communicate with our office.  Our job as your attorneys is to prepare and file a workable Chapter 13 plan and to work with you to keep that plan working.  If you foresee a temporary layoff or a job change, you need to let us know.  In some instances we can get a short term suspension of your Chapter 13 payment.
• in preparation for filing, you should gather receipts and think very carefully about your Chapter 13 budget.  Budget estimates are appropriate in some circumstances but inaccurate estimates in the context of a bankruptcy case can get you in trouble.

Clark and Washington sees dozens of clients each month in our five Tampa/St. Pete offices and our attorneys regularly meet to compare notes and to discuss current cases.   One of the changes that we have implemented in our case evaluation process has been to emphasize to our clients the importance of giving us accurate information about what the client and members of his household actually spend each month.  Chapter 13 lasts between 36 and 60 months and we need to work hard to make sure that we do not commit our client to a Chapter 13 payment that our client cannot afford.

We now suggest that our new clients keep a "to the penny" diary about spending habits.  You should keep this diary for a minimum of two weeks, although 30 days would be better.  You need to write down every penny you spend and keep receipts whereever possible.

Based on experience, we find that:

• most people underestimate how much they spend on food – both groceries and eating out
   
• many people spend $25 to $100 per month on items like cigarettes, checkout line magazine or candy purchases and other items that don't otherwise make their way into a budget
   
• kids are expensive!

If we have receipts and documentation we have resources to argue for a Chapter 13 payment that reflects reality, rather than estimates.  Keeping track of what you spend is always important, but never more so than when you are considering bankruptcy.