Not everyone’s career has set them up for a comfortable retirement. These days, more and more seniors can’t afford to live on Social Security alone. Sometimes, a senior is having difficulty earning the income they need to pay all of their bills.
Perhaps they were aged out of the workforce or forced into early retirement. Or, perhaps they were replaced with a younger worker who was more “up” on technology and commanded a lower salary. Or, perhaps they were let go because the company was downsizing.
At an age when many Baby Boomers are supposed to be retiring, instead they’re looking for work.
Before they know it, the creditors are calling and all the senior wants is to have their peace and quiet back. With debt piling up and no end in sight, sometimes the best alternative for a senior is to file a Chapter 7 bankruptcy.
For seniors, often the hardest part is getting over the stigma of bankruptcy. However, for many of them, filing for bankruptcy can bring tremendous relief from debt incurred by out-of-pocket medical expenses, home repairs, or needy adult children.
Financial experts will attest that bankruptcy is a valuable tool when it comes to protecting retirement assets. Unfortunately though, too many older Americans postpone filing bankruptcy for several years, after they’ve taken a big financial hit.
If you’re a senior and your finances are heading south, you should discuss the possibility of filing bankruptcy sooner than later with a qualified bankruptcy attorney.
When you have to dip into retirement assets, you run the risk of a downward spiral that can be much harder to recover from than if you were younger and more employable. A better financial strategy is to defend those assets at all costs.
How does bankruptcy protect assets?
Why? Because, under federal law retirement income and assets are usually untouchable during bankruptcy. Additionally, 401(k)’s, pensions, IRAs worth up to $1.245 million, and Social Security payments are exempt.
If you’re at risk of losing your home, you’ll be interested in learning that retirees can usually save their homes by using a homestead exemption, which protects the equity in a primary residence during bankruptcy.
To learn more about the advantages of filing bankruptcy if you are a senior, contact Dethlefs, Pykosh, Shook & Murphy Law today to meet with our Harrisburg and York bankruptcy attorneys for free!