Bankruptcy as a Strategic Move for Retirees in New Jersey

Retirement is meant to be a time of peace, not pressure. But for many seniors in New Jersey, financial challenges persist long after their working years have ended. Between fixed incomes, rising medical bills, and mounting credit card debt, it’s not uncommon for retirees to feel overwhelmed by expenses. At The Law Office of MaryBeth Schroeder, we often meet individuals who never imagined they’d be considering bankruptcy—but are relieved to learn that it can actually be a strategic, empowering move.

With over 30 years of experience helping clients throughout Monmouth and Ocean Counties, MaryBeth Schroeder offers compassionate, personalized bankruptcy law services to retirees facing tough financial decisions. If you're struggling in retirement, you deserve to know your options.

The Financial Realities Facing New Jersey Retirees

Living in New Jersey can be expensive, especially on a fixed income. Retirees are often dealing with:

• Medical debt from surgeries or long-term care

• Credit card balances used to cover everyday expenses

• Support for adult children or grandchildren

• Limited savings or investment losses

• High property taxes and housing costs

  
  

These challenges can add up quickly, leaving seniors feeling as though they're treading water. But if you're retired and struggling with debt, you’re not alone—and bankruptcy may offer the relief you need.

Chapter 7 and Chapter 13: What Retirees Should Know

There are two main types of consumer bankruptcy:

• Chapter 7: Often ideal for retirees with little to no disposable income, Chapter 7 allows you to eliminate most unsecured debts, including credit cards and medical bills. Many seniors qualify because Social Security income is not counted in the means test, which determines eligibility.

• Chapter 13: If you still have income from a pension, rental property, or part-time job, Chapter 13 might be a better fit. It creates a structured repayment plan over 3–5 years while allowing you to protect more assets.

  
  

At The Law Office of MaryBeth Schroeder, we’ll help you understand the differences between Chapter 7 and Chapter 13 bankruptcy and determine which path fits your goals.

Protecting Your Assets During Bankruptcy

One of the biggest concerns we hear from retirees is: “Will I lose everything?” The answer is no.

New Jersey and federal law both offer exemptions that allow you to keep many of your essential assets, including:

• Retirement accounts like 401(k)s and IRAs

• A portion of home equity, depending on which exemption system is used

• Your primary vehicle, up to a certain value

• Household goods, clothing, and other personal property

  
  

We’ll carefully analyze your situation to maximize these protections and help preserve the financial security you’ve worked hard to build.

Will Bankruptcy Hurt My Credit?

It’s true that bankruptcy affects your credit score—but for many retirees, this is not the primary concern. If you're no longer planning to apply for a mortgage or take on large loans, the impact on your credit may be minimal compared to the relief of eliminating debt.

In fact, many clients see their credit improve within a year of filing as their debt-to-income ratio becomes more favorable. More importantly, filing for bankruptcy gives you the chance to take control of your finances again—and that peace of mind is invaluable.

Other Options to Explore

Before filing, we’ll walk you through other potential strategies as well, such as:

• Debt settlement or negotiation

• New Jersey-based debt relief programs

• Reverse mortgages (with caution)

• Reducing expenses or downsizing

  
  

If those solutions aren’t viable—or haven’t worked—bankruptcy may offer the clearest path forward. You can learn more about your legal options on our website.

Dignity, Stability, and a Fresh Start

Choosing bankruptcy is not a sign of failure. For many seniors in Monmouth and Ocean Counties, it’s a practical, dignified way to stop the phone calls, end the stress, and move forward with confidence. Whether you're living in Toms River, Freehold, Middletown, or beyond, The Law Office of MaryBeth Schroeder is here to guide you through the process with care and clarity.

MaryBeth has built her practice on trust, transparency, and advocacy. She takes the time to explain every step, answer your questions, and ensure that you feel supported—not judged—every step of the way.

Let’s Talk About Your Options 

If you're a retiree in New Jersey facing unmanageable debt, schedule a free consultation today. MaryBeth Schroeder will help you understand your rights, protect your assets, and make the best decision for your financial future.