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Chapter 7 Bankruptcy may help seniors in Iowa protect assets

Many Iowa residents face financial setbacks at some point or another in their lives. Some setbacks are easier than others to bounce back from, but as people get older and their finances are in arrears, it can be difficult to recover. Considering credit card debt, mortgages, medical expenses or divorce, there are a number of ways that seniors can run into financial difficulties. When these debts spiral out of control, filing for Chapter 7 bankruptcy may be just what the person needs to get back in control of his or her finances.

Chapter 7 bankruptcy liquidates some of a person's assets in order to repay creditors. This allows people to reset their finances. However, certain exceptions do exist: student loans, alimony, child support, as well as federal tax bills that are less than three years old cannot be discharged. Moreover, dealing with bankruptcy's stigma often prevents people from filing soon enough. This can hurt people in the long run, especially seniors -- as they continue to spend their retirement assets, they initiate a downward financial spiral that could be more difficult to recover from than a younger person in the same precarious financial situation.


You notice Mom is experiencing memory problems or confusion or has actually been diagnosed with Alzheimer's disease. She does not have a will, a financial power of attorney, or any advance directive for medical decisions. Is it too late? Not necessarily.

Chapter 7 bankruptcy can be the best choice for Iowa residents

There are many reasons that people end up in debt. Between losing a job, medical bills and the rising cost of living, there are a multitude of ways that some Iowa residents can, all of a sudden, find themselves in over their head financially, wondering how they'll ever repay their debt. Fortunately, there are a number of methods to either systematically pay debt down or get rid of it once and for all, including Chapter 7 bankruptcy.

Some view Chapter 7 bankruptcy as a last resort, so many people try other means of paying down their debts, especially credit card debt. Some try to spend less as well as save and earn more. Others focus on paying off their credit cards one at a time, beginning with the one with the highest interest rate and, once that is paid off, taking that money and putting it toward their next credit card. Still others decide that consolidating their credit debt into one payment is the best method. However, many people fail to see the long-term cost of such a decision and that, sometimes, Chapter 7 bankruptcy actually makes more sense for them in the long run.

Credit Card debt might cause depression in Iowa residents

Many Iowa residents worry about their financial health, which often includes their level of credit card debt. The high interest rates that credit cards often carry these days are not the only damaging thing about carrying this type of debt. According to recent findings, credit card debt might actually increase a person's chances of depression.

Carrying high levels of debt places an undue and often enormous amount of stress on a person. Recently, researchers discovered a statistically significant connection between short-term debt, which includes credit card debt and overdue bills, and increased symptoms of depression. Unmarried and less-educated people, as well as those nearing retirement, showed the strongest link between debt and depression.

Premarital Student Loan Debt: Is Reduction During the Marriage a Marital Asset?

A hot topic in the family law arena is whether reduction of premarital student loan debt during the course of a marriage should be included as marital asset subject to division in the divorce proceeding. This Iowa Court of Appeals recently found that student loan debt incurred prior to the marriage is "a nonmarital obligation." In re Marriage of Campbell, No. 13-1383, 2014 WL 1999231, at *5 (Iowa Ct. App. May 14, 2014). In Campbell, the Court went even further to cite that:

Managing credit card debt in Iowa

Living with some amount of debt seems like a way of life for those in Iowa, as well as for most Americans these days. Whether it's credit card debt or for something deemed essential like their children's college costs or to pay for their homes, almost everyone has some form of it. Some types of debt aren't really a bad thing. For instance, a mortgage can help provide some tax advantages while replacing the cost of rent a person would otherwise be paying.

However, sometimes those already saddled with these sorts of debts take on additional debt for things that are, arguably, not essential, such as new clothes, vacations or a sports car, to name a few. Often, since there isn't the ready cash available to pay for these luxuries, people resort to using plastic. As a result, their credit card debt quickly increases.

Debt burdens could lead Iowa residents to personal bankruptcy

Having their finances in order may be a point of pride for many Iowa residents. Meanwhile, there may be many others who feel ashamed of their financial situations. Somewhere between the two extremes, there may be parties who think they have their finances under control only to discover that they do not. Financial struggles can be particularly difficult, and parties may find themselves considering personal bankruptcy if their debt burden becomes too much.

A recent survey of approximately 2,000 people across the country indicated that many individuals consider themselves confident in their financial knowledge. However, there were also a considerable number of those surveyed who felt concern over the states of their financial situations. Almost a quarter of the participants indicated that they do not pay their bills on time.

Worker's Compensation

With few exceptions, employers in Iowa are required to carry workers' compensation insurance. Insurance coverage applies if you were injured at work or while conducting work for your employer. The injury can be due to a single injurious event, and also to what is termed a cumulative injury due to repeated activity or exposures over time. Coverage under Iowa law exists even if you happen to get injured out of state while conducting business for your Iowa employer. There is also Iowa coverage if you live in Iowa, work out of state, and your employer has a place of business in Iowa. However, employers may try to deny valid claims, offer less than fair compensation, or use other tactics to intimidate employees into not filing claims. There are literally hundreds of legal issues that may arise. If you have been injured at work, make sure you at least consult with an experienced Iowa worker's compensation attorney to offer some advice, and who is willing to fight for what you are entitled to.

Iowa residents may want to understand credit card debt

Many Iowa residents are concerned with their finances, and part of that concern is placed on their credit scores. Some individuals may believe certain actions are helping their scores when they may actually be hurting them or affecting their financial situations in another way. Utilizing credit cards can impact credit scores, but too much use could lead to substantial credit card debt.

Some individuals may believe that having a high credit card balance may help their credit score. However, high balances are not always a beneficial aspect of a person's credit. Though parties may make monthly payments on time, if their balances are not paid off in full, their credit could actually be negatively affected.

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