I am 73 yrs old retired get $729 per month from social security and have 30,000 card debit, Can banks be requested to write off 50-60% and balance payable in small installment on low rate of interest every month. Can banks recover from my 19,000/-401k?
SAVAGE SAYS: There is simply no way to work yourself out of this debt — unless you can take on a part-time job. And no bank or card issuer will voluntarily write off a portion of your debt — unless perhaps you can offer a 50 percent settlement now, which does not seem likely from what you have written. Sadly, I think your best way out is bankruptcy. Bankruptcies of seniors are the fastest growing category as bankruptcy filings continue to soar.
But this is not a step to take lightly. So to get fair, unbiased advice, I’m going to suggest you contact your nearest local agency affiliated with the National Foundation for Consumer Credit by calling 800-388-2227. That will connect you to the nearest local office. You can trust them. Make an appointment, bring in all your information and they will even connect you with a good bankruptcy attorney if that is your only “out.” But you need to discuss your specific situation. I doubt that they can touch your 40l(k) — but since you are now taking required minimum distributions that would be factored into your “income” for bankruptcy purposes. And you don’t mention whether you own a house or condo, which could also impact your decision. So do talk to these counselors — and take their advice. It’s good that you are facing up to this issue, before things get worse.