Seymour's Blog

"Wipe Out Your Debts and Keep Your Retirement Money"

Before you start borrowing from your retirement funds to pay credit card debt and other unsecured debts, please do your homework and check out what other legal options are available to you.

The reason I am telling you this is because I have so many clients that come to me and file for bankruptcy to wipe out large amounts of credit card debts, medical bills, and other bills.

But, by the time they have come to me they have already cleaned out their retirement funds like their pension plan, their 401k, their IRA, or other retirement funds that they worked so hard to build up over so many years.

They have withdrawn these funds to pay their bills because they thought they had no other choices available to them.

That is because they were never educated about the benefits and positive things about bankruptcy. They thought that bankruptcy was one of the worst things that you could do and they thought that if they filed for bankruptcy they would lose all of their retirement money.

Here is the truth and the reality. The bankruptcy law is very liberal towards people who owe money. The bankruptcy law has its roots in the Bible and in the United States Constitution.

The policy of government is that honest people should be able to receive a fresh financial start when they fall upon serious financial hardships. They should have not to suffer and slave away for years to pay debts that they simply cannot afford to pay without pretty much ruining the rest of their lives.

Therefore, when you file a successful Chapter 7, within four months you can wipe out all of your unsecured debts which include credit cards, personal loans, medical bills, lawyer fees, surcharges on your drivers license, many old income taxes, debts arising from personal injuries sustained by other people, and virtually all other unsecured debts.

You wipe out those bills and you keep your property. Your property includes your house, your car, your jewelry, your personal possessions, (within the legal limits permitted by the law) and even your retirement funds.

You will be happy to hear that there is no limit on the value of your qualified retirement funds. As long as your 401k, IRA, pension, Keogh, or other retirement plan has been properly set up, you keep all that money when you file for bankruptcy.

On the other hand, if you’re withdrawing money from your retirement funds prematurely, in order to pay your debts, you are going to be paying taxes on that money, and you will also be paying a 10% penalty to Uncle Sam.

So, before you start withdrawing your retirement money to pay your bills, consider whether or not that is a smart financial move.

Once you understand the purpose and benefits of bankruptcy you might very well think again before you mortgage your future to pay those bill collectors that are trying to drive you nuts.

There is no shame or stigma involved in bankruptcy. We anticipate that about 2 million people will be filing bankruptcy this year. The number of people filing bankruptcy has been steadily increasing.

Before you make a major financial decision such as withdrawing money from your retirement funds, why don’t you speak to a knowledgeable lawyer about your legal rights and your legal options.

Bankruptcy is certainly not for everyone, but it most definitely provides an excellent solution for many people, and it is an option worth considering when you find yourself confronted with very difficult circumstances, and you wonder how you’re going to be able to keep paying all those bills. Feel free to call me with any questions you have. You can normally reach me in the office during the week from 8am to 8pm. I love to take my calls. My number is 856-696-8300. Please also check my very educational website at www.WipeOutYourBills.com.