Limits on retirement and social security income

[azref2627]

What is the name of your state? What is the name of your state? Arizona

I'm 75 and make $5500 from pensions and $1800 from social security. I had to support my daughter for years as she was sick with cancer (her and her husband also ran up my credit cards without my knowledge) and after she died I had to support my wife with a memory care facility with Alzheimer's.

I now have $20k left in my bank account and even though I make $7300 per month from retirement, my bills are $6000 per month for my wife's care and another $1500 a month for living and car expenses.

I've incurred $160,000 in credit card debt over the last five years and my monthly payments are $4,000 per month.

I'm not able to make payments anymore on my credit cards. Can they get a judgement against me once I stop paying and how does that affect my monthly income that I get? How does that affect the $20k balance I have in my account now?

Is there a limit on money I can have in my account if it all comes from retirement and social security income?

Really need good advice please. Thanks

 

[adjusterjack]

Yes, they can get a judgment and a judgment allows bank account levy which could snag the whole $20,000. For the amount you owe it's almost a guarantee that you'll eventually get sued.

Your pension and social security benefits cannot be intercepted. But once the money is in your bank account, it's a different story.

Social Security deposits have some protection under federal regulations. Two months worth cannot be garnished. Unfortunately, the same does not go for pensions. If pension money and savings are commingled in the same account a bank levy could freeze the account and you'd end up going to court to fix it while you can't use your money.

If you are going to pull the plug on your credit card debt, I suggest you use your bank account only for social security direct deposits and regular expenses, get the rest of your money out of the bank and have future pension payments mailed to you by check. You'll have to use check cashing services and money orders but that's probably the only way to safeguard your money. Buy a nice strong fire proof safe (for your cash) and bolt it to the floor and wall in your closet.

That doesn't completely solve your problem. Once the creditor gets a judgment it can summon you to court for a debtor examination where you will have to reveal the source and location of your money and the court could order you to pay under pain of contempt. Unfortunately, the default interest rate will have kicked in and your debt will be much higher.

You might want to consider Chapter 13 bankruptcy where your payments are reduced to a manageable level over a period of time (3 to 5 years) and any balances at the end of that period are written off.

Talk to a bankruptcy attorney before you do anything that can't be fixed.

 

[LdiJ]

Yes, they can get a judgment and a judgment allows bank account levy which could snag the whole $20,000. For the amount you owe it's almost a guarantee that you'll eventually get sued.

Your pension and social security benefits cannot be intercepted. But once the money is in your bank account, it's a different story.

Social Security deposits have some protection under federal regulations. Two months worth cannot be garnished. Unfortunately, the same does not go for pensions. If pension money and savings are commingled in the same account a bank levy could freeze the account and you'd end up going to court to fix it while you can't use your money.

If you are going to pull the plug on your credit card debt, I suggest you use your bank account only for social security direct deposits and regular expenses, get the rest of your money out of the bank and have future pension payments mailed to you by check. You'll have to use check cashing services and money orders but that's probably the only way to safeguard your money. Buy a nice strong fire proof safe (for your cash) and bolt it to the floor and wall in your closet.

That doesn't completely solve your problem. Once the creditor gets a judgment it can summon you to court for a debtor examination where you will have to reveal the source and location of your money and the court could order you to pay under pain of contempt. Unfortunately, the default interest rate will have kicked in and your debt will be much higher.

You might want to consider Chapter 13 bankruptcy where your payments are reduced to a manageable level over a period of time (3 to 5 years) and any balances at the end of that period are written off.

Talk to a bankruptcy attorney before you do anything that can't be fixed.

This....

I also think that you should look into Medicaid for your wife since your assets are depleted.