Choose a bankruptcy before liquidating your retirement account

By: Darrell Castle

You’ve gotten yourself nose deep into debt due to bad spending and poor money management. What should you do?


You have a nice-sized retirement account you’ve been investing in for years. That’s just money sitting there for the taking. It’s yours – you can use it if you want.

Or you can file for bankruptcy – but that just sounds awful, or so you may think.

But, is a bankruptcy awful, or is it actually your best choice?

A bankruptcy isn’t awful. If you’re faced with massive credit card debt and have no way to pay it, a bankruptcy IS your best choice. Sure, you have your retirement account you can use, but will it cover all of your debt?

Once you take out any of that money early, you’re going to pay a large penalty, which is the equivalent to flushing money down the toilet. Then, what money is left for retirement? None.

However, by filiing for bankruptcy, you can discharge all of your debt through a Chapter 7, or lump all of it into an affordable 3-5 year repayment plan through a Chapter 13. Then, once the bankruptcy is complete, you have created a fresh start to begin spending the RIGHT WAY.

Also, your retirement accounts are completely exempt from a bankruptcy, meaning you still have that retirement account to retire on!

I’ve seen it time and time again – people have worked so hard for so long to build their retirement account only to use it to pay off their debt while paying penalties on it. Most of the time, the money isn’t even sufficient enough to pay off ALL of their debt. So, they’re still in debt and have completely lost their six figure retirement money. And usually, since the problem remained unsolved, these people end up filing for bankruptcy down the road anyway.

However, if these people would’ve just come in and talked to me for ONE hour, I could’ve helped them get out of debt while saving their retirement account.

Don’t use your retirement account to pay off your debt. Consider filing for bankruptcy instead.

You need a bankruptcy attorney you can trust – one who’ll walk and talk you through every step of the process.

At Darrell Castle & Associates, you’ll get a law firm that’s received multiple Client Distinction Awards from Martindale-Hubbel for client satisfaction, so I can assure you that you’re in good hands.

Call (901) 327-2100 to schedule a FREE consultation with an experienced attorney, or fill out one of the contact forms on this page.