Wondering how to keep my retirement in bankruptcy, here is how to do it

Bankruptcy has a certain stigma attached to it, but there could be many compelling reasons to consider this. One of the key advantages of filing for bankruptcy is that it will let you achieve relief from unmanageable debt by either eliminating or restructuring the debt, thus making it easier to handle. Not everything is liquidated or sold in bankruptcy, there are certain assets that cannot be liquidated under Chapter 7 and Chapter 13 bankruptcies, such as a home and a vehicle of certain equity, tools, of trade, household goods, clothing, and retirement accounts.    

   

If you are wondering whether I will be able to keep my retirement in bankruptcy, then the answer is yes. Most pension plans, and retirement accounts such as 401(K)(s), and 404(B)(s), are protected from creditors during bankruptcy. This is done to ensure that the debtor’s long-term is not jeopardized under bankruptcy. The provisions of the US Bankruptcy Code allow an individual to keep my retirement in bankruptcy, and ensure that the individual can preserve funds set aside for their future, even if they are struggling with other financial obligations.    

   

Retirement accounts are exempt in bankruptcy    

Under federal laws, 401(K)(s) and 404(B)(s) accounts, and IRAs are often exempt from being included in the bankruptcy estate, and hence are protected. While 401(K)(s) and 404(B)(s) enjoy unlimited protection, IRAs usually have protection limits of approximately $1.5 million. If you are looking for ways how to keep my retirement in bankruptcy, you can consult the specialist bankruptcy lawyers at Recovery Law Group, who can help you with your state’s specific exemptions, as state exemptions laws vary from that of the federal laws. Some states may even offer broader protections to keep my retirement in bankruptcy. Recovery Law Group’s specialist bankruptcy lawyers are familiar with these exemption laws, and understand how these laws will apply to your situation.    

   

Navigating the complexities of bankruptcy    

However, in order to keep my retirement in bankruptcy, it’s crucial to maintain clear records of your retirement accounts, and ensure that they are separate from any other accounts that you may have. Mixing retirement funds with non-retirement assets can complicate the bankruptcy process. Your specialist bankruptcy attorney can help you navigate the complexities of the US Bankruptcy Code and bankruptcy laws, and ensure that you understand your rights in bankruptcy, and advise you on the best strategies to preserve your retirement savings. You can seek bankruptcy protection and explore options to keep my retirement in bankruptcy under Chapter 7 bankruptcy, provided you seek the Means Test.    

   

Debt reorganization plan by the court trustee    

To qualify for the test, your average monthly income for the past six months should be less than the average monthly income of the size of your family in your state. If you qualify for the test, you will be allowed to file for Chapter 7 bankruptcy, and most of your unsecured debts will be discharged or eliminated. Else, you can file for Chapter 13 bankruptcy, wherein a repayment plan will be worked out under the supervision of a federal court-appointed trustee wherein you will be allowed to repay your outstanding debts over a period of three to five years. Any outstanding debt after the completion of the bankruptcy will be discharged.   

   

Both Chapter 7 and Chapter 13 bankruptcies will give you the protection of Automatic Stay, wherein your creditors are prohibited from contacting you for debt recovery when you are able to successfully file for bankruptcy. If they continue to do so, simply inform your Recovery Law Group’s attorney, and they will sue your creditors for violating the Automatic Stay.