Bankruptcy for senior citizens can be a confusing and frustrating process – even more so than it might be for younger people. This is primarily due to the record-setting levels of credit card and medical debt seniors are ending their careers with. Retirement is no longer an option for all seniors. With incomes that often fall within two-hundred percent of the poverty level, the need for debt relief for these older Americans is apparent. However, the decision to file bankruptcy is a big one for anyone, but most especially for senior citizens.
When is Bankruptcy for Senior Citizens the Right Choice?
Answering this question and more can put minds at ease and guide families toward the best financial decisions to positively impact future generations as well.
When to Avoid Bankruptcy
Bankruptcy is sometimes seen as a way to protect and pass on assets to heirs. However, there are other options for doing so that do not require the sacrifice that bankruptcy for senior citizens can call for. When bankruptcy is filed, any assets that are eligible for sale or seizure to offset costs of discharged debts can be lost in the process, sometimes leaving seniors with very little to their name. If the only concern a family has is ensuring the passing down of property or other assets, consider trusts, gifts, and life estate deeds as good alternatives.
When Bankruptcy Might Be Necessary
Sometimes, bankruptcy is the best choice for older Americans. Seniors with massive amounts of debts may choose to file bankruptcy to prevent their families from owing large sums to creditors or losing out on most inherited wealth in the event of their passing. By choosing a debt discharge bankruptcy, these debts can be mostly eliminated, leaving the family of the senior citizen without the financial burden that might otherwise be there.
Medical debt is one of the most common types of debt for seniors to deal with – and it’s also one of the easiest to have relieved in the case of a chapter 7 bankruptcy. Other reasons for choosing bankruptcy for senior citizens is a need to rearrange car or house payments that have fallen behind. To keep from losing properties like these, a chapter 13 bankruptcy can provide a restructuring of payment schedules to allow seniors to get caught up on payments and keep these assets in the family.
It can be difficult to come to the decision to file for bankruptcy for senior citizens. It’s a decision that should not be taken lightly, and one that is best made when guided by industry professionals. While some bankruptcy attorneys are quick to recommend bankruptcy for senior citizens, it’s important to talk to a professional with a reputation for honesty to ensure you’re getting all the facts. A good lawyer will guide you through the best decisions for your individual situation and family, whether that involves filing for bankruptcy or looking for other options. Don’t get caught without the legal help you need to navigate this confusing process. Use our attorney directory here on My341 to find the perfect legal professional to help you move forward with your finances and create a better future for those who stand to benefit from those finances down the road.