Don't Be Like Lenny; or How to Behave During Your Bankruptcy

This post is inspired by the ongoing bankruptcy of Lenny Dykstra. Mr. Dykstra was at one time a very famous baseball player, and at a later time an apparently successful businessman with a line of car washes. As has been the case with many businesses (and former athletes), the success was built on poor fundamentals, and when the economy went south, so went Mr. Dykstra's business and financial situations.

"Nails'" story really isn't all that different from many of the people I see in my office everyday, save that he was playing with bigger numbers when it all came crashing down. The real estate and construction markets are nearly vaporized, and lots of hard-working people and families have been affected adversely.

What separates Dykstra's case from others in a more important sense is his behavior during the case. Mr. Dykstra has repeatedly sold property without court approval, ruined property (letting his dogs mess all over a house that was to be sold), and otherwise worked to the opposite ends than the bankruptcy court desires. As such, the judge has taken over his case, and Mr. Dykstra has been reduced to making half-baked claims about his superior will being critical to the success of his case. Needless to say, his case is not going well.

Every one of my clients come to me from a different place. The events that led to their arrival in my office are as varied as they come: job loss, medical expenses, divorce, failed business, stupid in college. But all of them have a desire to re-grasp control of their financial selves, and bankruptcy is a tool they can use to help regain that control.

But you have to want it, and you have to admit you need the bankruptcy code as an ally to get you there. Being too proud and declaring that you don't need help while standing in front of the bankruptcy judge is not a successful combination. The "fault" behind your filing may not be your own, but humility in the face of the situation is a must.

Some of my clients attempt to beat themselves up for failing; I try to stop them. A chapter 7 case is not a time for recriminations, it is an opportunity to move forward again. To be successful, you do need to closely and critically examine the "whys," but not dwell on them.

Do you need to make changes after you file? I would bet the answer is yes. You could become an expert coupon clipper, change your eating habits from restaurant to kitchen, find a more fuel-efficient car, or even stop smoking to spend less. Obviously your relationship with credit will need to change - perhaps a program like Dave Ramsey will work for you.

But a bankruptcy filing is a moment in time, that you can use to greater good, or waste by crowing about yourself like Lenny Dykstra. Use the opportunity wisely.

(And it is never a good idea to make the judge mad at you. Never.)