Filing for bankruptcy is a big choice that many couples and individuals are hesitant to make. Though Chapter 13 or Chapter 7 bankruptcy can be used as a tool to positively benefit a financial crisis, taking the leap is intimidating. Nevertheless, thousands of people who are living in the area of Cincinnati, Ohio, file for bankruptcy each day. If you are like most of these individuals and are considering bankruptcy, you naturally have many questions. One of the most common concerns that people have when filing for bankruptcy is the future of their retirement savings.
But there’s good news! Your retirement savings—or 401(k)—is protected in the event that you go through with filing Chapter 7 or Chapter 13 bankruptcy. Even if the funds in your retirement account far outweigh your total debt, not one penny can be taken to pay off your debts. Due to bankruptcy exemptions, your debts could be completely consolidated without you paying towards them at all.
Though your retirement savings cannot be improved during bankruptcy, it is very important that you learn the rules of this exemption and follow them as closely as possible. For instance, your money is protected—as long as it remains in your retirement or 401(k) account. Some make the mistake of transferring funds out of this account and into another, learning shortly afterwards that the money is no longer exempt.
If you would like more information on filing for Chapter 7 or Chapter 13 bankruptcy, as well as bankruptcy exemptions, speaking to an experienced attorney might be beneficial.