I beat Lehman Brothers to bankruptcy court by five days last September.  My path to BK began in 1994, when I triumphantly paid off $15,000 in credit card debt I had accumulated during the dry spells in my career as a freelance Hollywood assistant sound editor. 

Did I learn my lesson and resolve to stringently budget myself and never live off my credit cards again?


I went through an ongoing cycle of hot work years followed by cold ones.  My plan (if I even had one) was to dip into my credit to get by in the cold years and pay it down in the hot ones.  My last weekly salary was $1900 a week.  If I worked eight or so months a year for three or four years straight, I could bring my debt under control.

My debt began to grow as the cold years multiplied (1996, 1997, 2002, 2005, 2007, 2008) and I went back to using credit cards to pay my rent, basic expenses, and other credit card bills.

I confess.  I did it.  There were way too many beers, breakfasts, dinners and glasses of wine in restaurants where you pay up for the privilege of sitting in a chair two blocks from the beach.  There were plane tickets to visit family and friends and charges for concert tickets, weekend kayak trips, books, CDs and whatever else my impulses led me to buy.

I do not wear a closet full of designer suits or watch a flat-screen TV the size of an emerging nation. I bought my car and stereo system in 1988.  I have never been to Europe or South America or any other far-flung continent.  I did not run up my cards with martinis, blackjack and lap dances in Vegas.  Most of my debt was accumulated in an attempt, however misguided, to stay afloat in a feast-and-famine industry. 

I entered a self-inflated, denial-laden fog, believing I could go on without seriously sitting down and working out a simple household budget.  Surely I would have a couple of flush work years in a row and pay the debt down.  This turned out to be the personal finance equivalent of an ongoing, multi-year crap game.   

My creditors were my willing and enthusiastic enablers.  One raised my credit line to $49,500 and with every bill sent me “courtesy” cash advance checks offering three or four percent interest for the life of the balance.  These came with letters telling me I was one of their most dependable and worthy debtors.  Use these checks to go on vacation!  Remodel your home!  Pay your taxes! Pay off higher interest credit cards! Or write out a check to yourself! You deserve it!

I wasn’t paying 15 or 20 percent interest like other people.  I thought I was being smart, just like they said I was.  Now, I know what device every financially responsible adult should own.  A shredder.

Due to film industry contraction, I worked four months in all of 2007, one month in 2008.  I got offers for a couple of those 0 percent introductory rate cards and ran those up. My biggest creditor sliced $4,000 off of that $49,500 line.  My unemployment ran out last May.  I could see the concrete blast wall at the end of the tunnel.  

The mental fog began to burn off in June when my therapist told me I would have to go bankrupt.  If I didn’t, I would go through life dragging my debt, and the dead past it represented, behind me.  

I took a lot of long walks on the beach and around my neighborhood, turning my new normal over and over in my mind.  Bankruptcy was giving up.  Defeat.  Dishonor.  There were, however, no alternatives.

My moment of clarity came in late June. I got online, found a website where I could find a local BK attorney and typed in the amount of my credit card debt and my monthly income.  Ten minutes later, a woman representing the site called.  A local attorney called within a half hour after that.  When you type in $92,000 of credit card debt against 0 monthly income on a bankruptcy website, you’re bound to attract attention.

I borrowed money from one of my sisters, retained the attorney and began my reality-based life.  After steadfastly denying there was a recession for months, President Bush extended unemployment benefits.  This and the bridge loan gave me enough to cover my basic expenses.  I discovered a delicious $2.99 Malbec at Trader Joe’s.  Living within your means is not only possible, it’s a pleasure.

Filing for Chapter 7 is a legal rite of passage with defined ritual thresholds.  My attorneys prepared my petition. I sent them information about my income, tax returns, possessions, monthly personal budget and every other detail about my financial life.  I went over my petition with them and signed my name more times in an hour than I would in a year.

I took the required credit counseling and financial management courses online.  The biggest lesson I learned?  Just because creditors lend you money doesn’t mean they really believe you can pay it back.  Duh.

On the morning of Oct. 6, I drove into downtown Los Angeles for my First Meeting of Creditors, where a bankruptcy trustee and my creditors could ask me questions about my petition. 

I found the office building where the bankruptcy trustee meetings are held. I looked up as I was turning to circle the block to search for parking.  There, on a building across the street, was a sign for HSBC Bank, one of my creditors. 

I half-seriously thought they were up there with binoculars, staking me out.  Maybe they would send pit bull attorneys to grill me.  Or a couple of twentysomething frat boy bankers would sit in the back row and belch and cough obscenities when I was called up, like the guys in “Animal House.”

I nervously scanned my fellow debtors seated in the stark, government-issue room as the trustee moved through the cases ahead of mine.  Every guy wearing a suit or sport coat was potentially one of my creditors.  My name was called.

Three brown formica tables were arranged in an inverted “U” at the front of the room.  I sat on the left end, the trustee and clerk sat in the center of the middle section, my attorney across from me on the right end.

The trustee, a short, bald, bespectacled, dapper man, swore me in.  He flipped through my petition.  Did I own any other cars?  Did I have any other retirement accounts?  The questions seemed routine.  I answered “Yes, sir” or “No, sir.” 

My moment of destiny arrived.  He looked over the room and asked if any of my creditors were present.

I froze and stared across the table at my attorney.  He glanced over the room.  Silence.  Those suit and sport coat guys were other attorneys.  As is usual in cases like mine, the creditors didn’t show up. 

The trustee turned to me.  “How old are you?”

“Fifty-four,” I replied.

“You’re a youngster.”

“Thank you. ”

I have no idea what relevance this had.  Given the setting, being called a “youngster” as opposed to “loser,” “deadbeat” or “financial incompetent” was fine by me.  

As for those HSBC guys, maybe they were busy trying to figure out if that Madoff guy was for real.  He wasn’t.  HSBC lost $1 billion in Bernie’s scam for the ages.

Now it was a waiting game.  I faced one more tension-inducing deadline, Dec. 5.  My creditors had until that day to challenge the discharge of my debts.  It passed without a phone call or email from my attorneys.  On Jan. 17, the Holy Grail of all those who choose the Chapter 7 path, my debt discharge letter, arrived in the mail.  My credit card debt was gone.

So here I am.  My credit, my prized FICO score, the alleged sum total of my worthiness in our culture, is shot to hell.  My twentysomething car is paid off and still runs, but if it dies, I will have difficulty buying a new one.  If the earthquake fault running under my apartment building snaps and my place is red-tagged, landlords will look askance at a prospective tenant with a bankruptcy on his rental application.

My late father passed on to me the Southern culture of honor in which a man is as good as his word.  I regret that I did not keep my word to my creditors.

But I feel no remorse towards them.  I did what my creditors wanted me to do.  They had access to my credit reports, they could find out how deep in debt I was, yet they raised my limits and sent me the cards.  They never wanted me to pay it all off.  They wanted me to be their indentured servant for life.

And they made money from me, from the interest I paid them and the commissions they earned selling my debt to other lenders.  At least three different banks passed that $49,500 credit line amongst themselves.  My other cards also changed banks a couple of times.  

I would not be surprised if my credit card debts were packaged into securities and sold to investors, and credit default swaps taken out on those securities, with commissions and fees paid at every turn.  I bet somewhere some banker upgraded from a 300 to 500-series BMW churning my credit card debt and that of others.

I am not without honor.  There was no financial stress test for me.  Unlike our major banks, I had to admit I was insolvent, I was required to be financially transparent.  I publicly declared my inability to pay my debts, accepted my responsibility for them and gave my creditors an opportunity to contest their discharge.  I did so knowing this would have negative consequences for my credit and financial future.

Anne Lamott writes of a life in which “you haven’t dragged the old day along behind you.  The hope, the belief is that a new day is upon you now.  A day when you are emboldened…”  

After my petition was filed, I ran into a friend while running an errand.  He said I looked great, that I was “vibrant.” 

People were responding to me differently, striking up conversations and engaging me more.  Or maybe I had tapped into a new source of confidence and was engaging them.  I had made a tough, life-changing decision and was following through with it. 

If I can get through this, what else can I do?  What’s the next challenge, the next act?

The energy that used to be focused on my debt is now focused on pursuing the life I want.

A new day is upon me now. A day when I am emboldened.