Why Seniors Choose Chapter 13 Bankruptcy

Florida deserves its reputation as the best place to retire; looking up to see the seagulls fly by, as the sun reflects off of your reading glasses is one of life’s great pleasures.  While it is certainly possible to live within one’s means in South Florida, the cost of living has gone up everywhere.  Unless you were wealthy to begin with, an unexpected major expense can throw all of your financial plans off course and leave you struggling to meet your expenses.  Even though the stereotype about bankruptcy is a man who files for bankruptcy after each of his mid-life crises and the divorces that go along with them, the truth is much more complicated.  Financial hardship can happen to anyone, and bankruptcy protection is sometimes the best solution.  If you are a retiree or are reaching retirement age and are overwhelmed with debts, contact a Miami bankruptcy and retirement lawyer.

Financial Hardships Facing Seniors

If you have done any retirement planning, you have probably figured out that most of it is wishful thinking.  Life is full of financial challenges at any age, but there are some financial struggles unique to older adults, whether they have a fixed income from retirement accounts, Social Security, or a pension, or whether they are still in the workforce.  When you are young and healthy, you have more flexibility to take on additional work or gigs to recover from a financial setback.  This is more difficult when you are older, either because of age discrimination or financial limitations.  Likewise, the financial consequences can be devastating if you were planning to retire in your mid-sixties, but a serious injury forces you into early retirement before you can afford to retire.  Being eligible for Medicare offers some protection from catastrophic medical bills, but Medicare premiums are getting more and more expensive.

Lucky Number 13?

Chapter 7 and chapter 13 are the two most common types of bankruptcy filings for individuals.  Chapter 7 requires you to liquidate some of your assets in order to settle your debts, but this is not usually a viable option for seniors whose working years are behind them.  Therefore, seniors are more likely to choose chapter 13 bankruptcy, which does not usually involve liquidating your assets.  Chapter 13 bankruptcy involves entering a repayment agreement where you must keep up with affordable installments for three to five years, in exchange for some of your debts being discharged.  Therefore, most people who are nearing retirement age or who have already retired opt for chapter 13 bankruptcy.  A bankruptcy lawyer can help you get the greatest amount of debt relief if you decide to file for chapter 13 bankruptcy.

Bankruptcy Protection Is for Retirees, Too

Just because you are old enough to receive Social Security payments, it does not mean that you are too old to file for bankruptcy protection, and a bankruptcy lawyer can help you decide whether doing so would be to your benefit.  Contact Nowack & Olson, PLLC in Miami, Florida to discuss your case.

Resource:

nfcc.org/resources/blog/different-chapters-bankruptcy-explained/#:~:text=There%20are%20six%20chapters%20of,the%20most%20common%20forms%20filed