According to NPR, the rate of seniors filing bankruptcy is on the rise. Since 1991, the number of people over the age of 65 filing has tripled, and this group has different concerns than younger filers.
For older individuals filing for bankruptcy, there has to be an eye on retirement savings. It is possible to safeguard your savings, but it takes understanding the process and options to make the right decisions.
In many bankruptcy cases, your 401(k) and other employer-sponsored retirement accounts have protection from creditors. The court cannot generally make you use the funds in these accounts to pay off your debts. Individual retirement accounts have the same level of protection as 401(k) accounts.
You may be able to take an exemption for some or all of your retirement savings. Ohio offers options that you may be able to use to cover retirement savings, but you will need to understand the exemptions and how they work so that you know if you can apply them. Exemptions can be difficult to understand and apply, so be aware that you may need assistance with ensuring you use them correctly.
Bankruptcy can be quite complex. While you may want to completely protect your retirement savings, it may not always be possible. However, you should be able to figure out some solution using the options available to you. Remember that bankruptcy is a challenging chapter in your financial life, but with careful planning, you can emerge from it with your retirement savings intact and your financial future secure.