If I’m 72 years old and about to retire but have credit card debt that I can’t pay when I do retire, would it be best to file bankruptcy?

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If I’m 72 years old and about to retire but have credit card debt that I can’t pay when I do retire, would it be best to file bankruptcy?

Or should I just consider myself judgment proof and not bother to file? If I do go judgment proof, can I continue paying one credit card but stop paying on the others?

Asked on January 22, 2015 under Bankruptcy Law, Colorado

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

Technically, the term should be "collection proof," not "judgment proof"--the other side can get a judgment against you, but may not be able to then collect.

Whether you are effectively collection proof depends on the source of your income and what assets you have. Social security income, pension payments, many types of insurance annuities (but not all), distributions from 401ks and the money in them--all these cannot be subject to collections (e.g. garnishment or execution). However, regardless of your age or employment status, money in the bank, brokerage accounts, real estate, personal property (like cars), etc. can be all be subject to collections. So depending on what you have, you may or may not be collection proof.

Since this is an important and complex decision you have to make, you are advised to discuss the matter with a bankruptcy attorney before deciding what to do.


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