Mary PoolIn a few short weeks, many households will start receiving their tax refunds and wonder how they should spend those refunds.  At Bond & Botes, we would like to offer two suggestions:

Use Your Tax Refund to Eliminate or Reduce Your Debt

First, if your household is struggling with debt, being harassed by creditors or owes a considerable amount of debt, you should consider using your refund to eliminate all or part of those debts.  You can stop those creditors from calling you and finally receive the peace that you deserve.  Your tax refund can be used to pay fees associated with filing chapter 7 or chapter 13.

A chapter 7 may eliminate all or part of your debts within four to six months of filing.  You could be debt free in 2014.  A chapter 13 is more like a debt consolidation where it allows you to pay all or part of your debts over a maximum period of five years.  Assuming you make all the payments required of you in your chapter 13 plan,  you may be debt free after making all your payments.

At Bond & Botes, we offer a FREE consultation to help you determine the best method to eliminate your debts.  Whether it is filing bankruptcy or helping you see how you can tackle a debt on your own, our attorneys are here to assist you.  Call us today to learn how your tax refund may eliminate your medical debts, credit card debts, payday loans and other debts.  There is no reason for you to stress over your debts any longer.  Remember, your initial consulation with a Bond & Botes attorney is FREE.

Use Your Refund to Build Your Emergency Fund

Second, if you’re a household that is currently in an active bankruptcy, we suggest that you use the portion of your tax refund not devoted to your plan to build your emergency fund.  As you may remember, if you are in an active chapter 13, you cannot incur any debts without first obtaining permission from the bankrutpcy court.  That approval may not come quick enough if you need car or home repairs.  Therefore, it is always a great idea to have at least $1,000 in a savings account to fall back on in those emergency situations.  Eventually, you will want to build your emergency fund to support at least three months of monthly expenses.  If you have any questions about how to build an emergency fund, contact your Bond & Botes attorney.

We hope you and your family will be on your way to being debt free in 2014.  Happy New Year!

Mary Pool
Written by Mary Pool

Mary Pool is a shareholder of the Bond & Botes Law Offices in Montgomery and Opelika, Alabama. She holds a Bachelor of Science from Auburn University at Montgomery, and a Juris Doctorate from Faulkner University’s Jones School of Law. She has represented thousands of clients over her more than 11 years working in the bankruptcy field. Read her full bio here.

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