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Are Bankruptcy Retirement Funds Protected by Bankruptcy Law
By
Dominic S Scacci
It is a concern
of those who are filing bankruptcy that
their retirement accounts be protected and
they not lose the money they have worked
hard to save. In a time where social
security benefits will be gone by the year
2041, Americans must ensure a stable
financial future.
The good news is that under bankruptcy law,
retirement accounts are protected for those
who have worked hard at saving their money
to ensure a secure retirement when the time
comes. These accounts do not come under the
jurisdiction of any type of court because if
they did, the quality of life for the
bankrupt would be disrupted more so than by
the bankruptcy alone. Taking retirement
funds to resolve a debt would jeopardize the
future of the bankrupt taking away income
during a time in which they will be retired
and possibly unable to continue work.
There are so many negative outcomes if
retirement funds are taken away from the
individual, so laws have determined that it
is not at all viable to literally severely
hamper ones future by taking away their
retirement funds to resolve a debt. So one
can take comfort in the fact that their
retirement funds are protected no matter
what kind of bankruptcy (chapter 7, chapter
13, etc.) they are filing. If anyone ever
tries to say otherwise, then a bankruptcy
attorney can set the record straight.
Also, if your employer files bankruptcy, it
is good to know that employer funds are
separated from retirement money plans and
that the retirement money plans maintained
by your employer cannot be touched by the
bankruptcy court just as your retirement
plans independent from your employer cannot
be touched if you file bankruptcy. Yet if
your employer files bankruptcy, seek legal
counsel immediately to make sure that you do
not lose any money because of those
bankruptcy proceedings.
So take comfort in knowing that your future
is secure and that despite your short term
financial hardships, the long term is not
adversely affected unless the bankrupt
withdraws from their retirement fund
prematurely, which can create another kind
of issue. Just be sure to consult with a
bankruptcy attorney regarding any questions
about bankruptcy retirement funds.
Bankruptcy is not for everyone. If you feel
bankruptcy is the only thing that can help
you, go to
www.getlawyeradvice.com for a
bankruptcy attorney near you.
Conclusion
Are you one
of the many that suffer from insurmountable
debt and wonder if bankruptcy is an option?
Give us a call at (203) 924-6700 or
contact us.
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