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Category: Finance
Satisfied Customers: 4479
Experience:  Tax professional and business consultant for 35 years.
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I 't know what to do. I am 97k in cc debt from a failed

Customer Question

I don't know what to do. I am 97k in cc debt from a failed business and I have 3k in my checking account. I am not working now. My not working is not a shock since I do freelance finance in entertainment, I know the last day I am working on each project. I don't know when I will be going back to work though and to top it off, I only have unemployment for (5) weeks for a total of 2250.00 from now (5/30/16). I cannot file my next unemployment claim until 9/9/16 so from mid june through early sept, the only income I will have is 1000 a month from walking my brothers dogs. My rent is 1580, btw, then I have other bills, car paymeny at 525.00 car ins ...etc
I will be getting, from the sale of farmland a check for 83k, in the next few weeks, with the money in my bank account, I will have a total of 90k.
I will also be getting another check for around 50k in the next 7 months from the sale of other farmland, but this check is more of a ways off.
I need advice on what to do...
Given that I am not working now and not sure when I will go back to work, I don't know how much of my 97k in debt I should pay off right away and how much cash I should leave in the bank so i can get by until I find work. The last thing I want is to run out of cash and have to use my credit cards
Submitted: 1 year ago.
Category: Finance
Expert:  PDtax replied 1 year ago.
Hi from just answer. I'mCustomer I'll assist.
Expert:  PDtax replied 1 year ago.
The key to cash management is determining your monthly cash needs, then looking at your cash receipts and considering any shortfalls. I would do this each month for the next 6.
Expert:  PDtax replied 1 year ago.
It looks like you will have a cash shortfall until sale proceeds come in. I would access cash advance funds for enough to meet your 90 day cash shortfall and make your credit card payments of about $1800 per month. You might need a $10,000 or so cash advance.Then, once the sale proceeds come in, you might pay down 50% of the debt. It depends on your forecast.There will also be tax consequences with the loss from your closed business likely sheltering the sales you are expecting.You should consult with a tax pro to ensure you won't have an unexpected tax cost next April you can't pay.I hope that gives some insight. Anything more complex would involve a higher fee to assist you in your cash flow forecast, which you don't really need.Positive feedback is appreciated when you rate my response. I'mCustomer