I'm Retired, Can I File Bankruptcy?

Whether you’re retired or a working person, you may be able to file for bankruptcy. Individuals facing overwhelming debt and financial difficulties can seek bankruptcy protection regardless of their retirement status. It is the purpose of bankruptcy laws to offer debt relief to individuals or businesses unable to repay their debts no matter where they work or when they retire.

It is common for individuals to file for bankruptcy under two main types: Chapter 7 and Chapter 13.

This type of bankruptcy involves liquidating assets in order to pay off debt. According to bankruptcy laws in different jurisdictions, some assets may not be liquidated, allowing individuals to retain them. A pension, 401(k) plan, and individual retirement account (IRA) are usually protected from liquidation.

Bankruptcies under Chapter 13 require the creation of a repayment plan that pays off debts over a specified period, typically three to five years. Taking into account retirement income, such as Social Security or pension payments, can help determine disposable income.

Retirement funds and bankruptcy can be subject to different rules and exemptions depending on jurisdiction and individual circumstances. In order to understand the implications and options based on your specific situation, you may want to consult with a bankruptcy attorney or financial expert. Assisting you in determining the best course of action, they can answer your questions about the bankruptcy process and evaluate your assets If you are ready to file bankruptcy, give us a call at 203-265-5222 today.