Bankruptcy is a process where people can receive assistance with their debts by liquidating some of their assets. Although the thought of filing for bankruptcy is worrisome to many people, its goal is to help people get back on their feet and make a fresh start. However, it is understandable that people may worry about what could happen to their assets if they file for bankruptcy.
Here are a couple ways to deal with retirement savings when filing for bankruptcy in Ohio.
Know which accounts have protection and which do not
Many retirement accounts have protections in place that ensure that the bankruptcy process does not take money from them to pay off debts. Roth IRAs and accounts that fall under the Employee Retirement Income Security Act, for example, both have these protections. However, there is a monetary limit to how much of an IRA has a safeguard.
On the other hand, money that is in regular investment and savings accounts is likely not protected from going to debtors during the bankruptcy process.
Know when to get financial help
As long as retirement savings are in traditional accounts like IRAs, bankruptcy should not affect them. However, a financial advisor can let you know whether or not your retirement funds are safe from this process according to the specific rules and regulations in place in Ohio.
Knowing how to handle retirement savings when filing for bankruptcy can give people peace of mind and provide them with the best possible financial outcome to get them back on their feet.
