Bankruptcy as Part of Your Retirement Plan?

Saving is for wimps!  I have a plan for affordable housing.
Filing bankruptcy as part of your retirement plan might sound odd, but it merits consideration.  It is hard enough watching your retirement investments shrink without having to worry about paying your creditors.  Bankruptcy can be an important part of your plans to retire and be self sufficient.  Let me explain.

If you are approaching retirement age, bankruptcy can help you get rid of your debts and keep most or all of your retirement funds.  This protection extends to any qualified pension plan under the Employee Retirement Income Security Act (ERISA) such as:

  • 401(k)s
  • 403(b)s
  • IRAs (Roth, SEP, and SIMPLE)
  • Keoghs
  • profit-sharing plans
  • money purchase plans, and
  • defined-benefit plans

Debtors can protect as much as $1,095,000 per spouse if the funds are in an ERISA qualified plan.  Instead of pulling money out of your retirement account to pay off debtors, why not enter retirement free of debt and your retirement funds protected form your creditors?

Long before Lisa joined me as a paralegal, we were looking for a career that would allow her to work from home to spend more time with our daughter.  An estate planning attorney suggested the possibility of become a professional fiduciary, basically to help people with large estates manage their assets.  It was something she could do from home.

It has been estimated than as many as 80 million Americans were born between 1946 and 1964.  As they become older, the need for professional fiduciary becomes greater.  Many factors contribute to the need for these individuals to have a professional fiduciaries such as the effects of aging, mental disabilities, illness and retirement travel plans.  But investment losses in recent years might be delay retirement for some or prevent retirement at all.  Would you rather retire debt free or be worried about having enough money to live on a fixed income?

If you are in Southern California are facing difficult debt issues as you approach retirement, place call me today at (619) 4489-2129 for a free consultation.

Carl Starrett

Carl Starrett is a consumer bankruptcy attorney in San Diego, California helping debtors file for protection under Chapter 13 and Chapter 7 of the Bankruptcy Code.

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  • You raise a great point about the protection of qualified retirement
    programs.  I can’t tell you how many of my client’s would say, I took
    money out of my 401K to prevent this creditor or that one from obtaining a judgment. 
    The problem is those creditors could not have gained access to the 401K until
    such time as the accounts were liquidated.  I have posted many similar articles over at my blog and can not agree with you more.