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WWII Vet Spends Down Retirement Accounts Trying to Make Payments – Bill

“Dear Steve,

85 Year old WWII vet, ill health, In the late 80’s and early 90’s ran up $125,000 on several credit cards due to medical expenses and travel to other states to care for both our parents. We have spent all our IRA and about 85% of 401k on these bank cards. After retirement, got another job and paid card $2200 per month for 12 years until place of employment was shut down…no more jobs for an 80 year old. We have no assets except a home with $520/mo. mtg…8 year old auto @ $372/mo.

Never dealt in derivaties {sic}, so no govt. bail out….did not buy a house I could not afford, so no govt. bail out.

October is the last month I will make payments to 7 Bank cards…this will lead to fees, penalties, and very big interest rates. My $60,000 balance will probably wind up 80 or 90 thousand of which the IRS will show up wanting taxes on the write offs…I live in Texas, but the homestead home does not count for the IRS….so there goes the home! Is there any way out other than death????? THANKS!!!.

Bill”

Dear Bill,

I sure wish you found me a long time ago before you started draining the retirement accounts to service this debt. It could have been prevented.

But be that as it may, the good news is there is a solution. You MUST talk to a local bankruptcy attorney right away. That will protect what retirement funds you might have left and prevent a tax liability. Debt discharged in bankruptcy is not taxable.

I’d suggest you first read How to Get Out of Debt. The Honest and Unvarnished Truth and The Truth About The Success Rates, Failure Rates and Completion Rates of Credit Counseling, Debt Settlement, and Bankruptcy. They will give you a great overview of what we need to deal with to get you moving in the right direction.

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Then use the free How to Get Out of Debt Calculator to review your options.

Once you’ve identified a company you want to work with, then follow my step-by-step guide on how to check out a debt relief company.

Please post your responses and follow-up messages to me on this in the comments section below.

Sincerly,
Steve

You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.




About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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