Can a trustee force you to reduce your own contributions to your 401-k, or any other retirement plan to line the creditors' pockets with higher plan payments?
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I am not a trustee or an attn but I can not see why, since your retirement is just that, and hopefully not touched till retirement -
401K contributions stop during a BK 13. The money you are placing in the 401K is considered "disposable" and could be used to pay creditors.Comment
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depends on your district and also if you are in 100% payback. My brother is in 100% payback and was allowed to continue to contribute.
There are no absolutes, but I think the majority of the time you would have to stop. I have read, however is some districts the will allow the minimum amount required to get the employer match.Chapter 7 Pro Se....Discharged Feb. 2006Comment
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My trustee allows me to put into my 403b (the nonprofit company's equivalent to a 401K) but only for the amount that my employer requires, no extra. My employer requires 5% of my salary to go into the 403b (and then they match it with 9%) so the trustee alllows that, but if I tried to put in extra, like opted to put in 6 or 7% of my own money, that would not be allowed. I think it really varies from trustee to trustee though.Filed CH 13 September 17, 2007
Plan Modified July 8, 2009 from $1100/month to $400/month due to change in income, finally discharged in July of 2013!Comment
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Yeah, it depends on the district, and your percent payback. But generally, you may be allowed to contribute either up to the maximum the company allows or the up to the matching contribution amount.Comment
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Not in my district.Originally posted by AboutToBK13 View Post
DH and I are still contributing the same amount that we have been for the past kazillion years. I don't know if it's because we are older or we have a solid history of 401k contributions, but the trustee didn't even mention it.
HOWEVER, there was a lady at our 341 who just started putting the max amount into her 401 right before she filed (like a month previous). Up until she decided to file, she was contributing nothing. THIS caught the trustees attention and he was thinking that she was trying to *save* money from her creditors. He indicated that she either substantially lower her contribution or he would see her in front of the judge.Filed 07/07, $120k unsecured debt
Plan: $400 (includes cram down) 60 months
Brilliant attorney, decent trustee, awesome planComment
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The trustee never even mentioned anything about our retirement contributions. It was a non-issue. I pay into a state retirement system and my Dh pays into a 401K.Last edited by southerncomfort; 01-14-2008, 08:10 AM.Filed 2/2005
Last payment 9/2008
Discharged 12/2008Comment
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It was a non-issue when we filed. Our 401 k contribution was never touched as disposable income, but as others have stated I am sure that it depends on the district and the judge. Our attorney told us that the judge on our case is very sensitive with debtors over the age of 50.sigpicPersevere: "To continue a course of action, in spite of difficulty, opposition or discouragement."
Chapter 13: Discharged 03/15/2010. Closed 05/19/2010::yahoo::yahoo::yahoo::yahoo::yahoo:Comment
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My trustee did not say a word about my 4015 contributions, Im sure it would depend on how much you are contributing and what percentage your creditors are gettingComment
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I am 33 and was allowed to continue my 6% (my company matches up to that amount). There weren't any questions asked about it. It's nice knowing that I am building up some savings.Chapter 13 Filed: 2/7/07 Confirmed: 5/1/07 Discharged: 3/2/2012 Closed: 6/2/2012
130 out of 130 bi-weekly payments DONE
100% Completed
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Both hubby and I were allowed to keep making retirement contributions after we filed Ch 13. Our local court has a long-standing custom to not allow more than 5% of each filer's gross income to be contributed a year. We'd been contributing that for quite some time - it was never an issue in our case.I am not a lawyer and this is not legal advice nor a statement of the law - only a lawyer can provide those.
06/01/06 - Filed Ch 13
06/28/06 - 341 Meeting
07/18/06 - Confirmation Hearing - not confirmed, 3 objections
10/05/06 - Hearing to resolve 2 trustee objections
01/24/07 - Judge dismisses mortgage company objection
09/27/07 - Confirmed at last!
06/10/11 - Trustee confirms all payments made
08/10/11 - DISCHARGED !
10/02/11 - CASE CLOSED
Countdown: 60 months paid, 0 months to goComment
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Our Contributions Were Never Questions But Only 4%, We Also Had A Loan To Our 401k Paying 100 A Month Also Not Questioned, The Loan Has Since Payed Off, They Haven't Increased Payment Or Anything Yet. However I'm Waiting, Would Be Nice To Keep It For Some Wiggle Room, But I'm Sure Thats Unrealistic. But We Can Always DreamComment
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