Retirement Realities
Retired couple on beach
retirement
Does bankruptcy in retirement make sense?

Is bankruptcy worth it for seniors?
Next
7 of 8
Back
Is bankruptcy worth it for seniors?

At its core, bankruptcy is about providing the debtor with a fresh start. Debts are forgiven and the debtor is allowed breathing room to get back on track. But with seniors, bankruptcy raises some unique questions, says John Mlnarik, an attorney in Santa Clara, Calif.

"Anyone who files for bankruptcy should have something to protect, whether it is income, an asset or interest in some other exempt property," Mlnarik says. "An individual who is 'judgment proof' does not need to file for bankruptcy, so long as they are relatively certain they will remain that way for the remainder of their life (not get a new job, inherit anything or win the lottery). Seniors simply can determine with a greater amount of certainty that they will remain judgment-proof. And creditors, because of a person's age, are more likely to believe them."

Whether filing for bankruptcy protection is worth it for a senior varies with each individual case. Seniors with assets to protect can expect to pay around $1,500 for legal help, says Powell. And even when the filer doesn't have much in the way of assets, some seniors file simply to put an end to calls from creditors.


 

 

advertisement

Show Bankrate's community sharing policy
          Connect with us
MORTGAGE HOME EQUITY AUTO CDs CREDIT CARDS
Product Rate Change Last week
30 year fixed, 0 point 4.27%  0.05 4.22%
15 year fixed, 0 point 3.27% --0.00 3.27%
5/1 ARM 3.35%  0.13 3.48%
 
View Rates in your area Next
Product Rate Change Last week
30K FICO-based HELOC 4.38%  0.08 4.46%
50K FICO-based HELOC 4.11%  0.06 4.17%
100K FICO-based HELOC 3.96%  0.03 3.93%
 
View Rates in your area Next
Product Rate Change Last week
60 month used car loan 2.73% --0.00 2.73%
48 month used car loan 2.97%  0.04 2.93%
60 month new car loan 3.22%  0.05 3.17%
 
View Rates in your area Next
Product Rate Change Last week
1 Year CD 0.90%  0.02 0.92%
2 Year CD 1.09% --0.01 1.08%
5 Year CD 1.74% --0.00 1.74%
 
View Rates in your area Next
Product Rate Change Last week
Balance Transfer Cards 15.67%  0.02 15.65%
Cash Back Cards 16.36%  0.03 16.33%
Low Interest Cards 10.87% --0.00 10.87%
 
Next
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

Blog

Jennie Phipps

Stock gains send IRAs soaring

Fidelity Investments says IRA contributions set a record for the 2013 tax year.  ... Read more

advertisement
Partner Center
advertisement

Connect with us