“Q” is for Qualified Retirement Accounts:
One of the first questions a new prospective client has is if they can keep their retirement accounts if they file bankruptcy. The answer is that Qualified Retirement Accounts are completely protected in bankruptcy by the exemptions that are available in your case.
Qualified retirement accounts consist of your work 401k, or work 403b. They may also be called a qualified retirement annuity, or Individual Retirement Account (IRA). If you’re not sure if you retirement account is a “Qualified Account”, make an appointment for a free consultation where I will review it and let you know.
That being said one of the worse things you can do is cash out your IRA, or take a loan out on your 401K or 403B to pay off credit card debt. I have seen clients drain over $300,000 of their retirement accounts and only come to me to file bankruptcy after they ran out of retirement funds to pay their payments. Sadly, once the money is gone, they still ended up having to file for bankruptcy and now have no funds available for retirement.
If you’re having difficulty paying your mortgage, credit card debt, or other loans then please take advantage of the free consultation I offer before borrowing or removing any money from your qualified retirement accounts.
Peter Behrmann is a Livonia Bankruptcy Attorney. From my Livonia, Michigan location, I represent clients throughout Metro Detroit and beyond, including Garden City, Wayne, Westland, Redford, Dearborn, Taylor, Ann Arbor, Belleville, Northville, Novi, Farmington, Farmington Hills, Plymouth, Canton, and the Counties of Wayne, Oakland, Livingston, and Washtenaw. My practice is limited to helping consumers like you file Chapter 7 and Chapter 13 Bankruptcy, and Foreclosure Prevention.
Photo Credit: TooFarNorth
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