Should Financial Gurus Be Changing Advice?

In 2009, Suze Orman shocked a lot of people (including probably Dave Ramsey) and drummed up a lot of press when she changed her long-running stance on aggressively paying down credit card debt.

As many of you know, Suze has basically started to advise people to only pay the minimum payment on their credit cards and to instead increase their emergency fund to at least 8 months worth of expenses.

8 months… Really? Her justification is that many credit card companies are lowering limits and even canceling cards on those who pay them down.  She points out that if you lose your job due to the economy, you might not be able to access as much credit through the credit cards.  If you had a big juicy emergency fund, you’d be much better.  While the advice seems to be well-intentioned, I have a couple issues with it:

  1. Why 8 Months? For the majority of people, I think 8 months is a little extreme.  Especially considering they are struggling with credit card debt.  I’d be much more comfortable had she advised something more along the lines of an extra month of expenses.
  2. Increased Temptation. Suze is making the assumption that her audience can responsibly save up a large amount of money without finding an excuse to spend it.  Again, this is targeted at those people with outstanding credit card balances, meaning they’re already dealing with the issue of spending more than they make.  I know from experience that much more temptation exists when you have $10,000 in your emergency fund opposed to $1000.  That’s just a fact of life.
  3. Credit Cards Aren’t An Answer. I don’t think credit cards should be an answer, in the first place, to the solution of economic hardship.  Therefore, Suze’s whole justification falls a little short for me.  I prefer advice that suggests keeping a basic emergency fund and instead drastically cutting your lifestyle (ahead of time) in preparation for the possibility of losing your job.  After all, you can always go back to spending more than you earn once the economy rebounds.

Dave Ramsey’s advice hasn’t changed. Is that good or bad?

Dave Ramsey Total Money MakeoverIf I had to pick one financial guru that I agreed with the most, it would be Dave Ramsey.  Although, I can nit-pick some minor differences here and there, I’m a big fan of his overall guidance.  Lately, I’ve heard a lot of talk from both Ramsey and his devout followers about how his advice hasn’t changed.  His baby steps have always been and continue to be:

  1. $1000 Emergency Fund – Despite the economic conditions he’s stuck to this number in both prosperity and hardship. I am not sure why it’s just $1000 as it feels like it should be more like $5000 now in 2022 where inflation runs rampant.
  2. Debt Snowball Non-Mortgage Debt – Again, no change in how he’s advising people to attack debt.
  3. 3-6 months of expenses saved – Even after debt, Ramsey has suggested only 3-6 months.
  4. 15% for retirement – Ramsey hasn’t changed his investment strategies either.  He’s still a fan of mutual funds and has kept his 25%/25%/25%/25% diversification consistent.  He still hates gold, and still recommends a steady 15% at this initial level.
  5. College Funding – No change in when he suggests to prioritize college.
  6. Pay off your home early – He has also remained consistent on his policy to buy homes only once you are debt-free, on 15-year fixed mortgage, and so the payment doesn’t exceed 25% of your take-home pay.  Dave admits it’s a fantastic time to buy a home, but hasn’t switched his priorities.
  7. Build wealth and give! – No reason to change the ultimate goal of it all!

Dave Ramsey is a no-bs sort of individual. For example, he does not endorse Primerica and has stated on his Twitter that their insurance is expensive.

At first, I’ll admit I was a little proud.  “My financial guru is better than your financial guru!” But as I thought about it more, I wondered what was truly a more desirable trait.

Is it more desirable to follow a system that:

  • Sticks to its “guns” and doesn’t change with shifts in economic stability, or
  • Is open and willing to take in new information and adapt to external circumstances?

“Solid Principals” or “Ability To Adapt”…  which is more beneficial.  This has become a really difficult question for me to answer for myself.  Of course, a balance of the two is most likely the real answer.  Maybe Suze is onto something.  It’s not like she’s flip-flopped her entire message.  She’s just changed one part of it in response to an economic downturn.

For me, it all comes down to integrity and intent.  I’ve watched, read, and listened to enough of Dave’s content that I firmly believe his top priority is changing people’s lives for the better.  Unfortunately, I can’t say the same for Suze.  In fairness, I’m not nearly as familiar with her content.  The big question that I keep asking myself is:

Why has Suze Orman changed her advice?:
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  • Has she truly been exposed to new and credible feedback/information and has realized a different approach would provide a greater benefit for her audience? (certainly possible)
  • Or has she simply bought into regurgitating a hyped-up state of fear.  Is she leveraging this new change in order to create buzz, garner attention, and ultimately sell more of her heavily-sponsored products?  (certainly possible)

Once again, I honestly don’t know. I am dismayed by this sort of reasoning though. But this isn’t just about Suze or Dave.

It’s about your own set of financial principles and beliefs. Hardly anyone follows a specific guru or system 100% of the time in all situations.  We each build our own financial habits and principles based on what we feel is convenient, smart, and reasonable.

Ultimately, most of us realize a nice foundation of time-tested principles is essential to long-term success.  However, this doesn’t mean we have to ignore a new set of circumstances when they are presented.

The ultimate answer may lie in doing our best to process and form opinions on new information, while still double-checking any changes we may want to make against the principles of our core beliefs.

Do you prefer and approach like Dave Ramsey or Suze Orman?  Let everyone know below!

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Losing your source of income can be stressful, especially if you have a family to take care of and pending bills to sort. Fortunately, you can apply for unemployment benefits that will keep you afloat as you work on getting another job.

Check with the guidelines in your state to determine your eligibility. It is also important to see an estimate of the weekly benefit you may receive and for how long. To do this, you need to use an unemployment calculator. Our article will cover everything you need to know about unemployment benefits and how to estimate the benefits using our unemployment benefits calculator.

How Much Can I Get from Unemployment Benefits In My State?

The amount of benefits you can get will depend on your state. Each state considers different factors to determine whether one is eligible for unemployment, determine the payments, and how long the state will authorize the payments.

An unemployment calculator can help you estimate much you will receive weekly from your state in unemployment benefits. If you are eligible, the calculator will estimate how much you will likely receive. If you need more information on how our calculator works, go through our state’s unemployment calculator guide.

Unemployment Calculator By State

Let’s go through how unemployment is calculated in the state where you live:

State A-G

State H-L

State M-O

State P-Z

 

 

Check Your Unemployment Benefits by State

We understand that every state has different rules regarding the maximum and minimum unemployment amounts their citizens can get. Usually, each state has unique considerations and factors when calculating unemployment benefits. Therefore, we have specific unemployment benefits calculators for different states to ensure you get accurate estimates. Each calculator for each state factors the state guidelines and method of calculation to yield output.

A Guide to How Unemployment is Calculated

If you have used the calculator and are wondering why the estimate is not the maximum unemployment benefit amount, the answer would lie in the calculation. Note that there are numerous calculations that determine your weekly benefit amount.

By Calculation, I should Receive More than the $450 Maximum Weekly Allowed in California, Will I?

After doing the calculations and the results show that your weekly benefit should be higher than $450. What next?

If you live in California, the maximum weekly benefit is $450. So, if you believe you should receive more than that, please note it will be impossible. You can only receive more if the state increases the amount, which may increase with a rising cost of living.

How Fast Should I Expect my First Unemployment Benefits?

You probably have a lot of bills to take care of, and it is normal to get concerned about how soon you can receive your payments. After filing an unemployment claim as your state requires, wait a few business days for the state to receive your claim, see if you qualify, and process it.

The state will give feedback on your unemployment claim in a letter sent to your address. If your claim is accepted, the letter will contain details on how much you qualify to get weekly and the total annual benefit you will be getting.

How Long Can I Receive Unemployment Benefits?

Knowing how long you will be receiving unemployment benefits is important to find an alternative in time. Every state works differently, but you can expect to get the benefits for between 10 and 26 weeks.

However, after getting your benefits for a few weeks, you will need to fulfill some requirements to be eligible to receive additional benefits.

Note: If you use your eligible annual funds, you can exhaust your claim for a year. If this happens, you will need to wait at least a year since you filed the initial claim to expire before filing an initial claim.

Are you sure you are eligible to receive unemployment benefits? Log in to your portal. Go through the requirements and assess your eligibility.

Checklist: Do I Qualify to Receive Unemployment Benefits?

Unemployment benefits come in handy to ensure you keep up with your utility bills and other essential expenses before securing another job. The benefits help ease the financial anxiety of overwhelming expenses. Unfortunately, not everyone qualifies to receive unemployment benefits. Here is a checklist to help you determine if you qualify for unemployment benefits.

Reason for unemployment

Why are you unemployed? There are different reasons why you could be unemployed. For example:

  •     Retrenchment
  •     Resignation
  •     Furlough
  •     Leave of absence- voluntary or involuntary
  •     Termination, etc.

The reason for unemployment matters. You can only qualify to receive unemployment benefits if you are involuntarily unemployed. For example, if you voluntarily resign, you will not be eligible to receive benefits.

 Eligibility Criteria

You need to meet the following to be eligible for unemployment benefits. You should;

  • be unemployed, whether partially or totally
  • have earned enough wage during the base period
  • be involuntarily employed
  • be actively searching for work, willing, able, and available to work.

If you can prove that you have been actively seeking work, but your efforts are unsuccessful, you can maintain your eligibility. Therefore, you will continue receiving unemployment benefits. You will find more details on maintaining unemployment eligibility here.

How Accurate is the Unemployment Benefits Calculator?

You should know that the unemployment calculator only estimates the benefits you will likely receive. The results are not guaranteed; instead, they only serve as an estimation of what you should anticipate.

However, you can increase the accuracy of the results by answering the questions truthfully. Accurate data will help get more accurate results and avoid the disappointment of a great difference between the actual benefits you receive from the estimates.

Do I Have Other Financial Hardship Options While Unemployed?

Yes, you do. Assuming you had taken loans because you were sure of a stable income and were unexpectedly unemployed, you could have trouble repaying your loans. At this point, some may consider debt consolidation loans to consolidate the debt.

Unfortunately, when creditors notice you are defaulting, they will issue warnings and could proceed to court to get the courts to grant a wage garnishment order.

If they do and get the wage garnishment order granted, what next for you?

While being unemployed puts you at a disadvantage, and the unemployment benefit may not be enough to cover all your expenses and loans, you have more options you can try. You can:

  1. File Bankruptcy

There are two types of bankruptcy many individuals file:

a.) Chapter 7 Bankruptcy

You can file for Chapter 7 bankruptcy in your state, but Chapter 7 generally is based on Chapter 7 qualification. Chapter 7 is a fast way to get rid of debt, and within four months, you can have your unsecured debts discharged. This type of bankruptcy is also known as liquidation bankruptcy since the court might have some of your assets liquidated to offset your debt. Nonetheless, state exemptions can help protect your property from liquidation.

However, to file for Chapter 7 bankruptcy, you must meet some predefined income and asset requirements. Your income will need to be less than the state’s median income. To check whether you qualify, use this Chapter 7 bankruptcy calculator.

Additionally, note that you will pay an average of $338 filing fees. But the system acknowledges that you may not have enough, and you could qualify for a waiver on your filing fees. Check with the filing fee waiver income requirement in your state.

b.) Chapter 13 bankruptcy

Not eligible to file for Chapter 7 bankruptcy? You can file for Chapter 13 bankruptcy. This type of bankruptcy works by extending your repayment duration; thus, it could take longer to discharge your debt than Chapter 7 bankruptcy.

When you file for Chapter 13 bankruptcy, the court will prioritize some creditors. Your secured creditors, child support payment, and IRS debt, and you will need to pay these fast. The excess money will then be channeled to repay unsecured creditors.

You will need to develop a loan repayment plan that suits your current financial situation. The court will review and approve the plan before allowing you to make payments. Filing fees for Chapter 13 bankruptcy could cost around $313.

A bankruptcy quiz can help you estimate qualification and cost.

2. Work with a Debt Settlement Company

If filing for bankruptcy is not an option you are willing to consider, then you can choose to seek the services of a debt settlement company that will negotiate with your creditor.

Once you contact a debt settlement company and sign up with them, they will ask you to stop making payments to your creditors for a while. The goal is to make your creditor desperate and open to negotiations. During this time, you will be making repayments to a different Escrow account whose details the company will provide.

During the negotiation, the company will ask the lender to accept a payment of less than the original debt but in a lump sum. Most creditors agree to this. If they agree, the company will draft a written agreement.

Since you will be making payments to a different account other than repaying your creditor, it is important to work with a reputable and trustworthy debt settlement company. A fraudulent company could swindle you.

3. Debt Management

Not willing to file for bankruptcy and skeptical about working with a debt settlement company? How about debt management? Debt management is like credit counseling since you will seek the services of a credit counselor. The counselor will analyze your financial situation and recommend an actionable debt repayment strategy.

Like a debt settlement company, a debt management company can also negotiate with your creditors but for a different reason. A debt management company can discuss a new debt management plan with your creditors and convince them to agree to the new plan.

Often, a debt management plan could take as little as two or five years to clear the debt. The company can also ask your creditor to accept lower monthly payments and get them to reduce interest on the loans or to do away with some fees.

If the creditor agrees to the new debt payment plan, you will be making payments to the company, and they will be depositing the money to your creditors. So, vet a debt management company before seeking their services.

3. Debt Payoff Planning

If none of the three options above seem to work for you, you can choose debt payoff planning, a debt relief strategy where you develop a strategic repayment plan. You can choose to pay off your debts in order starting with one with the lowest or highest balance. Alternatively, you can choose to start with debts with high interest and pay those with low-interest last. To help you implement your repayment plan, you can use our debt payoff planning app to stay on top of your debts.

Take Away

Unemployment can be frustrating, but thankfully, you can get unemployment benefits to help you navigate life as you search for your next job. Usually, knowing how much you will receive can help ease your situation. Use our unemployment calculator to get an estimate of how much you can get from unemployment insurance. Also, consider our options above if you are in financial hardship to get a fresh financial start.

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If you are juggling different financial responsibilities (especially in the context of crippling inflation), it could be easy to lose track of some or hard to keep up with all, leading to wage garnishment. Your creditor might sue you, and the court could grant a wage garnishment. A wage garnishment is an order to your employer to withhold a portion of your earnings to pay the creditor. A wage garnishment can also be granted for payment of child or spousal support.

A wage garnishment order is often unexpected. So, when you receive it, it is important to read through the order. Identify why the wage garnishment has been placed, how much will be garnished, and then seek legal help to stop it.

How Much Will My Employer Withhold to Fulfill the Wage Garnishment?

When your employer gets the wage garnishment order from the court, they will withhold a certain amount from your wage. Using a wage garnishment calculator, you can estimate how much will be garnished.

Besides the estimate, a wage garnishment calculator may also show the wage garnishment cost and offer insights on what you can do to stop the garnishment. A wage garnishment calculator is generally easy to use; unlike others, you won’t need to sign up or input your email address. Note that the output will be an estimate, not a guarantee of the amount.

What is Considered When Calculating Wage Garnishment?

Different factors are considered in computing wage garnishment. Each state has unique laws on wage garnishments, while some don’t allow wage garnishment. So, we have wage garnishment calculators for every state. Select your state when using our calculator. You can use a wage garnishment calculator to give an estimate how much you may be garnished.

In calculating wage garnishment amounts, there are two primary considerations. The applicable minimum wage of the employee and their disposable income. Based on this information, you can decide how much to withhold from their paycheck.

However, the law states that the maximum amount that can be garnished is the lesser of:

  •     50% of the difference between the employee’s applicable weekly minimum wage and their disposable earnings or
  •     25% of their weekly disposable income.

However, check the laws in your state. Also, check for updates on the law since the rules constantly change.

Will the Garnishment Calculator Give Similar Results Across My State?

No. There are other factors that will affect the results. For instance, the calculator considers the minimum wage. So, the results for someone living in Washington will differ from those of someone living in Seattle.

Below is the wage garnishment calculators that you can take for your state:

How do Employers Decide How Much to Withhold?

For accuracy and to comply with state laws, employers use an employer wage garnishment calculator tool to decide how much wage to withhold. Unlike the regular calculator you can use to know how much is being garnished, the calculator designed for employers is quite different and complicated.

Higher Order Priority in Wage Garnishment Calculation

There are different reasons you might get a wage garnishment order. But there is a higher priority order that the courts follow. Before discussing this order, let us discuss how a creditor can get a wage garnishment order against you.

If you should be making payments, e.g., for loan repayment or child support, and you default, the owed party can sue you. During the hearing, the owed party will present their case and ask the court for a writ of execution. They will also submit an earnings withholding along with their request for a writ of execution—a document to authorize your employer to withhold your earnings.

If the court grants the wage garnishment order, they will notify your employer immediately. When you have different withholding orders, their priority will differ. Here is the higher-order priority followed in a state like California:

  •     Child support
  •     IRS and other owed taxes
  •     Payment to a dependent adult
  •     Withholding order

The order of priorities will depend on the state. States like North and South Carolina, Pennsylvania, and Texas forbid wage garnishment orders for unpaid debts.

How Can I Stop Wage Garnishment?

Although a decision from the courts may seem final, it isn’t. You have several options to try and stop the wage garnishment order against you. When using our calculator to estimate how much money will be withheld from your weekly pay, our calculator will suggest and compare these options. They are:

1. File an Exemption

When you get the wage garnishment letter, you can object to it in writing. Usually, the instructions on how to file an exemption will be included in the document. Therefore, read the order thoroughly.

If there are no details on how to file an exemption, consult a legal expert on how to go about it. Furthermore, working with a legal expert will increase your chances of stopping the garnishment than doing it alone. Although you are legally allowed to file an exemption, most garnishments are valid; therefore, exemptions are hard to receive. Is your income protected? Use this example letter to file your exemption and stop wage garnishment.

2. Declare Bankruptcy

If filing an exemption does not work, or your legal counsel advises against it, you can choose to file for bankruptcy. When you declare bankruptcy, the wage garnishment orders against you will be lifted, especially orders by creditors for outstanding debt. For example, filing for bankruptcy is a smart solution if you recently lost your job, are living paycheck to paycheck or your earnings are below the median income in your state.

You can file Chapter 7 or 13 bankruptcy, depending on your financial situation. Chapter 7 bankruptcy is more popular in the United States because it is more affordable. However, do your research, as you risk losing some assets to liquidations. Note that you will only lose assets not protected by the bankruptcy exemptions in your state.

You also need to be living below the median income in your state to be eligible to file for Chapter 7 bankruptcy. You can take a bankruptcy means test and see if you qualify. If you don’t, you may be able to file for Chapter 13 bankruptcy.

Chapter 13 bankruptcy is ideal if you have some income. It helps you get rid of debt by adjusting your repayment plan. When you file for Chapter 13 bankruptcy, the court will ask you to draft a new debt repayment plan that you can spread for three to five years. If you qualify for Chapter 7 bankruptcy, but your wage garnishment order still stands, you can file Chapter 13 bankruptcy to get the order discharged. Note that Chapter 13 bankruptcy takes considerably longer to execute than Chapter 7.

How Much Will I Need to File for Bankruptcy?

The cost of filing for bankruptcy depends on the type of bankruptcy you wish to file. For Chapter 7, you will pay an average of $338, while Chapter 13 will cost an average of $313 in filing fees.

Besides filing fees, you might need to pay attorney fees as well if you choose to use one. We recommend using the services of a bankruptcy attorney to simplify the process and increase your chances of the court granting debt discharge. Fortunately, a majority of bankruptcy attorneys are willing to work out payment plans where you can pay their fees in installments. Some Chapter 13 bankruptcy attorneys could also add their fees to the repayment plan.

Do the fees seem a little too much for you at the moment? If your income is below the poverty threshold in your state, the state can waive your filing fees. Before declaring bankruptcy, consider other debt-relief options, and compare the costs.

You can also consider other options besides bankruptcy such as debt settlement or debt management.

3. Work with a Debt Settlement Company

You can choose to settle the debt with the company by seeking the services of a debt settlement company. This option, however, works for debts and is not effective for spousal or child support.

What Do I Do Next?

Once you are notified about the wage garnishment order, identify why the order was placed. Then, determine how much will be withheld from your pay using our wage garnishment calculator. Let it play out if the amount is not very significant and you are comfortable with the deduction. If you aren’t, consider the above options to stop the garnishment.

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As a Christian, it may be tough to face the idea that bankruptcy may be the only way to get out of a dire financial situation. We’re taught from an early age to be good stewards of the wealth that God has given us. When we come to the realization that, somewhere along the way, we may not have done this well, it can be difficult. But, if you are at this point, it’s important to recognize that declaring bankruptcy and restarting with a clean slate may be the best way to reorganize your financial situation and become even better stewards of your wealth. 

If you are ready to take on the process of declaring bankruptcy but need a little bit more information before getting started, keep reading. We are going to look at the differences between Chapter 7 and Chapter 13 bankruptcies and which may be best for your situation. 

Chapter 7 and Chapter 13 Bankruptcy Overview 

I’ve come across multiple individuals that are not happy with filing a Chapter 13 bankruptcy, and, oftentimes, this is due to a lack of proper explanation of the differences that exist between these two bankruptcy types. From what we observe, most bankruptcy applicants have not realized these three things: 

  1. Most attorneys have payment plans for Chapter 7 bankruptcy 
  2. It’s much more expensive to file for Chapter 13 bankruptcy than other bankruptcy types 
  3. It’s possible to keep your assets in a Chapter 7 bankruptcy discharge 

Let’s help you to understand these two bankruptcy types in detail: 

What is Chapter 7 Bankruptcy

 This type of bankruptcy is commonly called liquidation bankruptcy. In this bankruptcy type, a bankruptcy trustee liquidates (or sells) assets nonexempt assets. There are instances of Chapter 7 bankruptcies without liquidations, however. Despite this, there’s still a possibility of loss if you don’t properly review the limitations of the bankruptcy exemptions prior to filing for a bankruptcy discharge. 

Those who can file for a Chapter 7 bankruptcy are mostly businesses, individuals that have incurred business debts, and those that meet its income requirements. You have to qualify for Chapter 7 bankruptcy, otherwise, the court will deny your case. 

The requirements for businesses are different from the requirements for individuals. Make sure you are aware of the differences and which ones apply to your situation. 

A Chapter 7 bankruptcy may stop a wage garnishment. That said, if you received papers for a wage garnishment, you may want to take a wage garnishment calculator to see how much you will be garnished each pay period. That can help determine whether the garnishment will be debilitating.

What is Chapter 13 Bankruptcy? 

This type of bankruptcy is one that gives debtors the opportunity to restructure their debts into a more suitable Chapter 13 repayment plan. A limiting factor with this type of bankruptcy is that it’s only available to individuals with a steady flow of income. Individuals that earn from businesses can also file under Chapter 13, however, their business cannot get a discharge under this bankruptcy plan. Businesses that want to restructure their debt can apply for a Chapter 11 bankruptcy instead. 

Most Chapter 13 bankruptcies have a 60-month term. However, a debtor may opt for a 36-month term if their income is below the state’s median income. The courts determine what an individual owes based on that person’s expenses, assets, debts, and income. In certain instances, their recent financial transactions also have a role to play in their Chapter 13 bankruptcy plan. 

In a Chapter 13 bankruptcy, you can often keep your house.

Pros and Cons of Chapter 7 Bankruptcy 

There are multiple advantages and disadvantages of bankruptcy to consider before filing for this type of bankruptcy. Here are some: 

Pros:

  • Chapter 7 bankruptcy offers one of the fastest ways to get rid of debt. The court discharges a good number of no-asset Chapter 7 cases in less than six months. 
  • Debtors don’t have to make any payment to a creditor prior to getting a bankruptcy discharge. 
  • There is such a thing as an affordable Chapter 7.
  • A debtor can simply surrender their collateral to the creditor to get rid of unsecured debt. It doesn’t matter if the property is worth less than the debt owed. Legally, creditors cannot pursue you for any leftover debt. 
  • Debt collection lawsuits is a common reason for bankruptcy. Often, many of the debts associated with the debt collection lawsuit would be discharged.

Cons:

  • Generally, exemptions do not protect luxury items. 
  • A chapter 7 trustee has the right to sell a property that bankruptcy exemptions don’t protect. 
  • Not all debt is discharged in Chapter 7 bankruptcy. Thus, the debtor may still owe some money even after the case has been closed. Debt that is non-dischargeable in bankruptcy includes child support, student loans, alimony, and most tax debts. 

 

Pros and Cons of Chapter 13 Bankruptcy 

There are numerous pros and cons to consider before filing for Chapter 13 bankruptcy. Unfortunate there are also instances where people have had bad experiences. Some pros and cons of this bankruptcy type include: 

Pros:

  • Chapter 13 bankruptcy helps to prevent repossessions and foreclosures. Not only is an automatic stay placed on your debts as soon as you file, but you are also given the ability to pay off what you owe over an extended period of time. This can help you keep your assets.  
  • Filing for a Chapter 13 bankruptcy plan can help secure assets that would have been at risk of liquidation if you had filed Chapter 7 bankruptcy
  • Stretch out your repayments into manageable installments over the course of 36-60 months.

Cons:

  • It costs more to pay for Chapter 13 attorney fees, but most attorneys include their fee in the Chapter 13 bankruptcy plan. 
  • Debtors can’t incur new debt or sell their assets without first seeking court approval in a Chapter 13 bankruptcy plan. 
  • Chapter 13 bankruptcy takes longer than Chapter 7 bankruptcy.

Bankruptcy may not be your only option. For example, many people compare debt settlement to Chapter 13 bankruptcy. You can also consider debt management, also known as credit counseling.

Factors to Consider When Choosing Between Chapter 7 and Chapter 13 Bankruptcy 

There are many things to consider before deciding between filing for Chapter 7 and Chapter 13 bankruptcy discharge. 

Income Requirements 

Making a choice between chapter 7 and chapter 13 bankruptcy can be somewhat challenging. One of the important factors to consider first is your income. It’s required that you meet the income requirement that’s determined by a Bankruptcy Means Test before you’re issued a bankruptcy discharge. 

If your income is above the requirement for a Chapter 7 bankruptcy, then you should consider Chapter 13 bankruptcy instead. This is especially true if you have enough disposable monthly income to make payments towards your debts, even if they aren’t quite hitting the minimums.

If you have become unemployed recently and have taken an unemployment calculator to estimate your benefit amount, your lower income may help you fall under the means test. That said, many people would prefer to be employed vs. unemployed, but it’s an interested, helpful thing to know.

Equity in Property and Assets 

You can only get protection on certain amounts of assets with a bankruptcy exemption. Assets that are worth above the allowed bankruptcy exemption could be lost in Chapter 7. But, with Chapter 13, you can simply enroll in a repayment plan to keep your property. 

Foreclosures and Repossessions 

If you’re falling behind in mortgage payments, then Chapter 7 bankruptcy isn’t a suitable alternative. It’s best to restructure your finances to help you catch up with required mortgage payments, apply for modifications, and refinance your mortgage loans. However, filing for a Chapter 13 bankruptcy prevents foreclosure by restructuring your payments. 

Also, if you find it challenging to make car payments, then Chapter 7 won’t offer you the needed protection. The lender may request that you make payment in full. You may be able to redeem your car if the amount you owe is worth less than what you owe on the car. 

For a Chapter 13 bankruptcy, payments can be spread out over a couple of years to reduce your payments. In certain instances, you may be able to reduce the amount you owe if the car is worth less than the loan payoff, and you’ve bought the vehicle over 910 days prior to filing for a Chapter 13 bankruptcy discharge. 

Conclusion

There’s no way to get around it: bankruptcy can be confusing. If you are at the point of considering bankruptcy, we’re sure it’s a hectic and frightening time. Despite this, it’s important that you do your research and make sure you are filing for the bankruptcy option that will best help you get out of debt and back to a point of financial stability. We hope this article gave you at least a little insight into the differences between Chapter 7 and Chapter 13 bankruptcy and you have a better idea of which option may be best for your situation. 

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It’s 2022, and the coronavirus has changed how we live. Many people are working remotely and would like to continue doing so.

Here are some things I love about working from home, but I had questions in the comments in two particular areas. The first was simple – what can you do as work-at-home work, and how do you transition your skills into that set?

The other was a little more detailed and involved how to find freelance clients, deal with “droughts” and irregular income, and so on.

I’d like to talk about the first today, and then in a couple weeks, we’ll talk more about the business angle of freelancing!

[So what kinds of work can you do from home?]

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Picture of women's clothes at a thrift store

According to the Census Bureau, the thrift industry in the United States amasses a staggering revenue of about $17.5 billion annually. 

What’s more? Statistics from numerous experts believe that this shopping method is currently growing. This shopping method has expanded, as stores now leverage the internet to sell their clothes.

Whether patronizing a thrift store online or within the vicinity, consumers have maintained that these stores have been a valuable means of saving money.

If you’re looking for an article that provides in-depth knowledge about this industry, then you’re in the right place. The points we’ll discuss in this article are: 

  • Definition of a thrift store, 
  • How to find the best thrift store? 
  • How to find the nearest thrift store? 
  • How to start a thrift store?

Let’s dive right into the crux of the article: 

What is a Thrift Store? 

According to the Cambridge dictionary, a thrift store is where used items like clothes, books, artifacts, etc., are sold to raise money for charity. 

Thrift stores are sometimes called consignment stores. However, this is a wrong view. For a better understanding, let’s make a quick comparison. 

Thrift Store Consignment Store
  • Profit from item sales goes to charity. 
  • Items donated remain in the store till they’re sold. 
  • A good number of thrift items are of poor quality. 
  • Ownership of the item is automatically transferred to the store once the item is donated. 
  • Profit from sales goes to the seller. 
  • Owners consign their goods to the store for a specific time. 
  • Consignment items have a high value. 
  • The ownership of items remains with The consignor until the item is sold. 

For more information, read this article that properly details thrift stores vs. consignment stores. So, how do you find the best thrift store to use? Let’s discuss this: 

How to Find the Best Thrift Store? 

According to census.gov, the United States alone has more than 25,000 Not for Profit resale shops as of august 2022. With this high number of stores: how do you find the best amongst them? 

To find a great thrift store for your shopping, do the following: 

  • Read through reviews on reputable platforms, 
  • Check if it’s located in a reasonable vicinity, 
  • Inquire about the time it closes and how frequently it’s open. 

Let’s discuss each of those points. 

Check out their Ratings and Reviews. 

Ratings and reviews are summaries of past customers’ experiences, providing insight into the quality of their thrift collections, customer-friendliness, and whether the purchase is worth it. 

Beyond this, the review also lets you know the best and the worst items to purchase in the store. Since most reviewers are honest, they’ll likely detail their pre-purchase and post-purchase experiences. Thus, helping to inform your decision on which item is genuinely worth buying. Sometimes the seemingly valuable product is of poor quality, but by checking reviews, you’ll know the durability of the thrifts they sell. 

Is the Thrift Shop in the Right Location? 

Ideally, it would be best if you shopped at a thrift store nearby. 

However, here’s a little trick to getting better quality. 

Quite often, the quality of donations to thrift stores varies from location to location. Generally, high brow areas tend to have thrift items of better quality than low-income earning areas. 

Let’s compare goodwill stores in different localities as an example: 

Goodwill Menlo Park CA vs. Goodwill Salinas

Goodwill Menlo park is located in a high-brow area, while salinas are located in a low-brow one. 

Taking Google reviews on Goodwill Menlo park into account, items in this thrift shop are reasonably priced compared to alternatives. However, they are of top-notch value. Also, the clothes there are renowned brands like Calvin Klein, Coach, Jimmy Choo, Michael Kors, Kate Spade, etc. Each of which sells at $15 to $20 per piece. 

Google reviews on Goodwill Salinas suggest that the items there are of low quality. Albeit ridiculously cheap, some reviews described most of the thrifts there as “trash.” There are also complaints that the store has a multitude of resellers who are hurriedly hunting for the few high-quality items available. Thus, the chances of getting something of quality are extremely low. 

Goodwill Mountain View vs. Goodwill San Fernando

Goodwill mountain view is located in a high-brow area, while the other is not. Let’s compare what Google reviews say about how both differ. 

Google Reviews on Goodwill Mountain View, also called Goodwill of Silicon Valley, portrays the location as numerous high-quality items. Reviewers also show that it’s the ideal place for finding random items like woodcraft, fancy dinnerware, and other items you won’t easily find online. The only demerit noted by reviewers is that items are somewhat pricey but still significantly cheaper than the cost of purchasing new items of the same quality. 

On the other hand Google Reviews on Goodwill San Fernando portrays that most items here have poor quality. Reviewers opined that the only way to get high-quality items is to be somewhat lucky and aggressive. People can push you out of the way to hurriedly get their hands on new bins. One reviewer even noted that they probably sell items that don’t get sold in other stores. 

As you can see from the examples given above, location is one of the primary factors to consider before patronizing a thrift shop. Another factor to consider is when the thrift store closes.

What Time Do the Thrift Stores Close? 

As with other stores, thrift shops have closing and opening hours. Thus, before scheduling a visit, you should run a quick search–particularly for visitation to thrift stores outside your locality.

 

Popular Thrift Stores Opening Hours 
Goodwill Most Goodwill thrift stores open: 

  • 9:00 am – 8:00 pm (mon-sat)
  • 9:00 am – 6:00 pm (sun)

For specific opening hours of Goodwill stores per location, click here.  

The Salvation Army Stores open: 

  • 10:00 am – 6:00 pm (mon – sat)
  • Closed (Sun)

Click here for store location and specific opening hours. 

GoodFair Always open. (online-based)
America’s Thrift store Most America’s Thrift stores open: 

  • 8:00 am – 9:00 pm (mon-sat)
  • 11:00 am – 7:00 pm (Sun)

Click here for specific opening hours per location.  

 

As seen in the table above, opening hours for thrift shops differ from brand to brand. And in some cases, it also varies per location. 

How to Find the Nearest Thrift Store? 

Finding a thrift store by yourself can be difficult depending on your locality. However, you can easily find stores near you by asking friends, families, and neighbors. Or by using these websites.

Google  

The easiest way to find a thrift store close to your home is via Google’s “Near By” feature.  

To use this tool, type in the keyword “thrift stores near me” on Google, and a map of available thrift stores will pop up. The map also provides directions on how to get to the store. And if you have a specific item you’re searching for; you can narrow your search to only specialty stores. 

Specialty stores are those that have unique offerings. For example, some thrift stores specialize in providing second-hand books. You’ll likely find a high-quality book at a specialized store than a generic book store. 

Thrift Store Locator

There are web-based platforms that aim to provide users with thrift shop reviews and generic info about specific stores, e.g., The Thrift Shopper. These platforms allow you to locate stores via postal code and location. 

Check Through Your Neighborhood

All thrift stores work by receiving donations from people. And as we’ve demonstrated earlier, shops in high-brow areas have better quality thrifts than those in low-brow areas. Thus, you may want to visit specific neighborhoods in your city for thrifts. 

Review Platforms

Like any other enterprise, thrift stores are featured on review platforms like BBB, Yelp, etc. Review platforms help you search for businesses per location and also tell you if the store is worth visiting or not. It’s in your best interest to carefully read these reviews as past customers make them and let you know what to expect from these stores. 

Acquaintances 

Chances are high that someone you know in your neighborhood has either used a thrift store before, seen one nearby, or knows someone that uses it. Ask within your circle of influence, and you’ll likely get a much-needed answer. 

How to Start a Thrift Store 

Starting a thrift business is undoubtedly a lucrative enterprise, and there are statistics to prove that. One such is by IBISWorld, which reported that the thrift store market will grow by 2.4% this year alone. Another interesting stat is that over 40% of thrift purchases are by Gen Zs and millennials

Thrift companies like ThredUp, Poshmark, etc., are experiencing rapid growth. If you’re thinking of joining this line of business, you should first choose your niche. Would you rather opt for an online store or a physical store? Let’s educate you on both. 

Online Thrift Store

Before you start selling thrifts online, it’s best first to choose your niche. In considering a niche, think of your interests, items you can quickly get donors for, and items that are easily resaleable. Examples of thrifts you can sell are: 

  • Antiques,
  • Furniture, 
  • Home Decor,
  • Clothing Shoes.

Once you’ve chosen a niche, the next step is selecting a suitable platform. Top platforms for selling thrift items are: 

  • eBay,
  • Etsy,
  • Instagram.

eBay

eBay is a low-priced eCommerce platform that allows sellers to display items for sale. Sellers can either display items at one-off prices or encourage bidding. 

To sell thrift items on eBay: 

  • Open a seller account on eBay, 
  • Pay the requisite fee, 
  • List your items for sale, 
  • Set the parameters and price. 

Etsy

Etsy is a platform that connects individuals that want to sell vintage items, crafts, arts, and handmade goods with buyers. To make sales on Etsy, you should follow these steps: 

  • Create an Etsy account, 
  • Choose your category, 
  • List the item, 
  • Pay $0.20 per listing. 

 

Note: Etsy takes an additional 5% on the sales fee. 

Instagram

Instagram is one of the most popular social media platforms. The platform has business accounts that let users sell services on the internet. You can sell thrift items on social media by following these steps: 

  • Create a business account on Instagram, 
  • Upload your thrift items, 
  • Sponsor your posts.

 

Perhaps you don’t wish to sell your thrift items online. You can also sell them offline. Let’s discuss how to open a thrift store. 

In-Person Thrift Store

If you’re willing to start an in-person thrift store business, one thing to consider is licensing. Let’s discuss this: 

What License Do You Need to Start a Thrift Store Business?

The United States has some basic licensing requirements to start a thrift shop at the federal, state, and local levels. Albeit these requirements differ per location, there are some basic permits you should be aware of. These are: 

  • Federal Licensing 

Thrift stores in the United States must adhere to the US Consumer Product Safety Commission  (CP stipulationsSC). This organization oversees thrift store regulations. It also restricts thrift shops from selling certain items like cribs of a certain age, leed paint, toddler and infant products, etc.

 

  • Local Licensing 

Although states determine most thrift store regulations, some cities also have restrictions. Cities with such laws are New York and Iowa. 

Other licensing you’ll need to get are: 

  • Business name registration, 
  • General business permit, 
  • Sales tax permit. 
  • Federal employer identification number 
  • Resale certificate 
  • Certificate of occupancy.

In Summary,

Thrift stores provide users with household items for some of the most cost-friendly prices possible. However, to benefit from this shopping style as an end user or an entrepreneur, there is some information you should be aware of. This article contains all the tips and tricks you need to shop right. We also talked about some vital information about owning a thrift business. 

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