Bankruptcy by the numbers

Top 10 tips for filing your case and achieving financial freedom

(1) When should you file bankruptcy? Sacramento attorney James Keenan offers the following rule of thumb: If your total debt is more than three to five times your monthly income, it may be time to consider filing.

(2) You are not alone. CoBen & Associates’ Web site, at, notes that luminaries such as Mark Twain, Henry Ford and Kim Basinger filed for bankruptcy yet went on to later success.

(3) Organize financial data. Chances are, you keep lousy records. Nevertheless, the new law requires detailed information from the previous six months.

(4) See a bankruptcy attorney. There are dozens in the area, and most offer free consultations with no obligation to hire the attorney.

(5) Consider credit counseling. The new law requires it, and you may be able to come up with a payment plan that avoids bankruptcy. A list of approved credit counselors can be found at

(6) Pro se or not pro se? Anyone who serves as his own attorney has a fool for a client. However, some believe that if you’re single, have no major assets, earn less than $43,436 annually and have time for a crash course in bankruptcy law, it may save money and be worth the effort.

(7) No major purchases. Buying a $3,000 stereo with your Visa right before you file bankruptcy has a name: credit-card fraud.

(8) Be honest. Really.

(9) Relax. Once you’ve filed successfully, there’s nothing left to do but kick back and wait. Be thankful that by law your creditors no longer can pester you.

(10) Go plastic-free. Believe it or not, credit-card companies will continue to solicit your business. Resist. Use your ATM card in place of a credit card. Your account will now actually have money in it.