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Will a Chapter 7 Bankruptcy affect your Certificate of Deposit saved for Retirement?
If I have a Certificate of Deposit for 30K for the purposes of my retirement, will that create any problems with my Chapter 7 bankruptcy case?
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Answers (1)
Having a lot of any type of asset will probably create a problem with your Chapter 7 bankruptcy case. Depending on the state where you live and file your bankruptcy, there are only certain amounts that can be used as “exemptions” in order to protect your assets. Once these “exemptions” are exhausted, there is very little that can be done to protect your assets. Retirement funds should be kept in proper retirement accounts and only then can the full allotment of those funds be protected.
For example, in some instances, those filing Chapter 7 bankruptcy in New York are only allowed up to $600 in cash in their bank account when the papers are filed. However, IRAs and other retirement funds are mostly protected in almost all states. Contact an attorney in order to find out how to best protect your assets when filing bankruptcy as it can be done but you have to be careful and know the law.
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Posted by Marina Ricci on 22 Jan 2010
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(4 Votes)