I was watching CNN last night when Suze Orman came on and I happened to hear her say something that was quite important to anyone who might potentially lose their home and may eventually file bankruptcy. She was talking to a caller who had recently filed bankruptcy. She asked the caller if they had a retirement account and the viewer said, "Yes with a balance of $60,000".
I was surprised to hear Suze say that the Bankruptcy court can not touch funds in a retirement account. I immediately thought about how many people dip into their retirement account when they get behind on their payments. The long and short it is that if you are in financial trouble you should think twice before using the funds to pay your bills if a bankruptcy may be inevitable.
I think that too many people get bullied by creditors and volunteer their retirement accounts thinking that they can somehow avoid the inevitable. The moral is to consult a bankruptcy attorney if you find yourself facing a serious financial hardship.
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