Are you retired and thinking about bankruptcy? Do you have questions about what will happen to your savings if you file for bankruptcy to eliminate your debts? What happens to your retirement funds will depend on the type of bankruptcy you decide to file for.
Filing for Bankruptcy After Retirement
If you are already retired and living off of your retirement accounts, that money might be accessible to creditors if you file for bankruptcy. When you file for bankruptcy during retirement, you will need to show the court how much income you need in order to meet your living expenses. If you file for Chapter 7 bankruptcy, your retirement income will used in the means test analysis. If you decide to file for Chapter 13 bankruptcy, the income from your retirement plan or plans will usually be included when the court makes its decision for how much debt you can afford to repay to creditors.
What About My Social Security Benefits
Federal law protects your Social Security benefits from most creditors. However, money can be taken from your Social Security check before it's sent to you for the payment of federal taxes and the following federal debts:
- Student Loans
- Child Support
- Court-Ordered Restitution Owed to the Victim of a Crime
After your Social Security benefits are deposited into your bank account, your creditors can’t take the money. Under federal law, banks must determine if federal benefits are included in an account before they allow money to be seized by creditors. Banks must also protect two months’ worth of Social Security or similar government benefits that are included in your account.
Do you need advice regarding bankruptcy? Then give our experienced lawyers a call at (321) 320-6088 to set up your free case evaluation today.