The 4 Things Struggling Seniors Should Know

if you're a senior struggling with debt or money issues it's hard to enjoy your life but there are certain things you should know that can help you deal with your financial difficulties hi i'm jeff hoyt editor-in-chief of seniorliving.org in this video attorney eric olsen executive director of the helps non-profit law firm will tell low-income seniors the four things they should know that can help them turn their difficult financial situations around believe it or not your income is protected your bank account is protected your assets are protected against virtually all lawsuits and it's easy to stop debt collectors from bothering you the former bankruptcy attorney will explain all these important financial concepts that can benefit you as well as how eric's law firm could help you at no charge because i'm in los angeles and eric is in portland we will be conducting the interview via zoom [Music] hi it's jeff hoyt editor-in-chief of seniorliving.org and once again i have the pleasure of speaking with attorney eric olsen eric is the founder and executive director of the helps non-profit law firm which helps seniors and other people who are struggling with debt welcome eric good to be here jeff so we have lots of seniors struggling with money and who are in debt any idea how many seniors there are in this category well okay the census bureau says there's more than uh 50 million seniors that are over the age of 65. and uh 13 of those um are over 65 are under the poverty level okay uh and that's all and it's more in some states than others obviously and then there's another another factor the economic policy institute did a report and they have what's called um classifying someone as being economically vulnerable and what that is if you have income within 200 percent of the poverty line you're classified as economically vulnerable and 48 of seniors over 65 are classified as economically vulnerable and the number goes higher as they get older and so you know if there's 50 million seniors that's nearly 25 million seniors that are classified as economic and vulnerable so there's a lot of seniors that face financial problems a lot so for these millions of seniors facing financial problems as you put it what's the number one thing that they should know that they may not know today the number one thing they should understand is that federal law protects their social security income it can't be garnished or taken from them uh by a consumer collector from a by a debt collector it's protected um if i have 50 seniors in the room maybe 48 of or 49 out of 50 don't really understand that fact that their social security is protected now additionally a lot of seniors get a pension uh some form of retirement there was a law passed in 1974 called the employment retirement security act or it's called erisa and what it did is it it said if if pensions were set up in a certain way that money would be protected and from debt collectors so virtually all pensions today all forms of retirement uh iras um 401ks that money is protected under erisa uh it can't be garnished or taken from a senior protected automatically [Music] now in addition to that federal law protects veteran benefits and then there's state laws that protect um disability income uh and also doubles and protects some of this income also but the federal law is what's important so virtually all forms of seniors retirement income is protected from debt collectors and i guess that's our most important message that we want them to know that if you're struggling and you have a lot of debt you don't need to use that money to pay debt you can't afford to pay congress protected that money for a reason they didn't want seniors to go without medicine to go without food uh to pay pay debt they didn't they couldn't afford to pay so that's our most important message is this income is protected and your law firm also works with veterans are va benefits uh protected as well they absolutely are under federal law va benefits are protected are there any exceptions well there's a few the irs can do what's called a set off of 15 of a person's social security for past two income taxes uh we don't see the irs typically trying to set off pensions or other forms of retirement fund we don't theoretically can but we don't see it happening most of the seniors we work with are middle income or lower income seniors iris does not only they would do is they would send a notice that they intend to offset uh 15 of a person's social security however uh if a senior is lower income okay um there's half of seniors that are within 200 of the poverty line they should be able to qualify for what's called non-collectible now stats and not have to pay the irs these taxes and that's that's not that difficult to do we tell people how to do that you can get on the phone with the irs wait two hours go over the budget and you can qualify for non-collectible now center so you don't have to pay the irs now the same with student loans student loans okay there's two types private and public public student loans federally insured student loans can do a set off of 15 of social security now they're not allowed to do it right now because of covet and some other rules but if a person has student loans and their lower income they can get on what's called an income based repayment plan and often that payment would be zero dollars per month now if they're disabled get the student loans wiped out uh now after that about the only way you're going to have your social security taken is or is if you owe past due child support we rarely see that as the case and that gets kind of complicated uh but so if you owe student loans or taxes and your lower income you can you're not shouldn't have to have your social security taken it's protected in addition it's protected from all these other creditors as well so a lot of income for seniors appears to be protected by federal law and state laws um is there anything else that these laws protect for seniors their bank account is protected federal law protects a bank account i'll explain okay there used to be a big problem with the seniors would get sued and someone would garnish their bank account and uh um even though that the money in the account was from a protected source and it was a big problem so back in about 2012 uh congress had federal rules implemented and what these federal rules provide is that twice the amount of federal benefits and that's social security most federal pensions that amount of money that's deposited into a bank account twice that monthly sun is automatically protected from garnishment by federal banking regulations so if a senior got uh like fifteen hundred dollars in social security each month and it's deposited into a checking account and that means that three thousand in that account is protected automatically regardless of what monies are in the account at the time of a garnishment okay so if the person had money in there from something they sold on ebay or maybe they want a little lottery ticket or a little gift as long as there's less than um twice the amount of the federal benefit in the account the bank account is protected now how does that happen the bank itself protects that money the banker credit union has a department that um governs uh the tournament that handles garnishments and they know the rules and so if there's a garnishment on a person's bank account they look at the bank account and there's a code that tells them where the money came from and if it came from a federal source they times that times two and as long as the amount the balance in that account is less than that some then they simply rip up the garnishment uh you know throw it they ignore it they throw it away now if the senior had more than twice the amount in that account uh it's a senior that came from a protected source a senior could file a challenge a garnishment or a claim of exemption with the court to have the money released but most of the time when i talk to seniors they'll tell me well eric i never have more than twice the amount of my social security in that checking account and then i tell them well you don't need to worry so if they call and they and there is a judgment or there's a threat of a judgment and they have more than one bank account i i would i might i would tell them you know you really only need one bank account and that's the account to which your social security is deposited and it's twice that amount is protected now some seniors should understand that uh the bank manager probably doesn't understand that law they don't because they have nothing to do with garnishments uh i'm i'm guessing that 99.9 of attorneys don't understand that law you see for years there was a different rule they talked about if monies were co-mingled it could be taken but there were so many problems with that that congress saw that federal rules changed it to automatically protect bank accounts which social security was deposited regardless of the source of funds in the bank account at the actual time of a garnishment and that's been a wonderful change in the law because a lot less headaches for seniors nowadays because of that rule but only if they know about it thanks to people like you they should know about it because they want to be careful if there's a judgment that they keep less than twice the amount of the federal benefit in the bank account so that if they were garnished uh nothing would be taken out of their account it's not like they're going to be garnished anyway but you know it could happen but this way it's it's just it's insurance they don't need to work and do they need to worry about their other property like a car or a home or uh anything else if they uh if their bank account's protected could could a creditor go after their property yeah so their bank accounts are protected and then so a lot of time seniors might worry about well are they going to take my car or i'm going to lose my home someone's going to come in and take my furniture or things like that okay i get the answer is essentially no no i mean uh then i'm gonna explain why okay first off virtually all states have what are called exemption laws that exempt specific certain types of property uh exemption laws that will protect uh an amount of equity in a home or an amount of equity in a car or it will exempt you know certain amounts of personal property a lot of states most states have what's called a wild card exception which says that if if uh if this isn't covered by our exemption you have a certain amount of money you know like maybe you have four thousand dollars that will cover everything else so the rules get kind of complex and most of the time these rules are used when a person if a person filed bankruptcy a bankruptcy trustee will look at that to see if the property is exempt but as a practical matter if a senior got sued and got a judgment uh even if they owned property that was over above the state exemption it's really not the practice of consumer judgment creditors especially credit cards or bank loans or anything like that to go after the a person's property if it was not exempt uh there's a lot of reasons for that um it's a complicated process they have to you know get a court to authorize it and a lot of times they have to put up a bond and as a practical matter you know personal property your furniture and all this other stuff isn't worth a whole lot of money uh if it's even if it's over the exception uh and they've learned by a school of hard knocks that it wouldn't work and then there's ways to if it were to happen there's ways it could be stopped so seniors losing their personal property it's just not going to happen it just doesn't happen now if a senior was sued and there was a judgment um and they owned a home okay uh the judgment can become a lien on the home in certain states um and so let's assume that the senior had equity in that home over and above the homestead exemption for that state will that creditor come in and try to take the seniors home well a lot of people might try to scare a senior into thinking that that's a possibility and but once again as a practical matter no it doesn't happen uh consumer judgment creditors get the judgment and they're happy to let it sit there and hope they hope that they get paid uh when the home is sold or free finance or at some point in the future but they won't take steps to try to take the person's home and there's a lot of reasons why first off they'd have to pay off an existing mortgage and they're not in the business to do that okay that might be a lot of money number two they'd have to pay the homestead exemption and then they have to pay an attorney go through all that paperwork and it could it's just not worth it to them now the only time i've ever seen this happen is if you have a particularly vindictive creditor a relative or someone like that and there's really it's really clear that there's a lot of equity in there but as a practical matter that is so rare and it can things could be done even at that point to to solve the problem but uh no they don't need to worry about their property being taken i mean some debt collectors will try to use in certain states will try to use certain state authorities to intimidate a senior into thinking that it's going to happen that's utah was one state texas also they have like constables in utah and in texas they have a you know these little local corsa that will send a letter out and they'll think oh my gosh you know we're going to lose our property well no like in texas there's a 50 000 exemption that goes over all your personal property and there's no way on earth that a senior would have that amount of equity in in their personal property so no they don't need to worry about losing their property it's just not going to happen good to know so you mentioned debt collectors and even if they can't uh get a judgment or collecting a judgment against a senior um debt collectors can still call you and harass you is there anything seniors can do to protect themselves from debt collector harassment absolutely and or anyone for that matter too uh and i guess that's a another thing that seniors need to know so if they know that they're um their income is protected okay and they know their bank accounts are detected and they know that no one's going to take their personal property so they say i'm not going to pay my debt but it's not very fun to have the creditors call you they can make life miserable or even file a lawsuit okay and think oh my gosh what i you know so it can be very scary okay so back in uh 74 there was a there was a law pass um it's called the fair debt collection practices act fdcpa and that sets out the rules that collectors have to follow uh in trying to collect that you know they can't call before or after a certain time uh they can't uh threaten that they're gonna do something that they don't intend to do or they they can't there's there's you know they can't swear across they can't say illegal things i mean there's a lot of rules uh but one of the most important part of that fair debt collection practice is that that it provides that if a a debtor in this case a senior debtor sends what's called a cease and desist letter to a debt collector that debt collector can no longer legally call that person or send a demand letter or send letters to that person anymore okay and that should needs to be sent uh it has to be in writing and sent to the debt collector uh and you know i call them commandments and i i you know i say one of the major commandments under this rule is that if a debt collector gets a cease and desist letter they know they can no longer call this senior anymore or send them demand letters they got to leave them alone and the law also provides that if a senior is represented by an attorney then the debt collector can no longer call or send a man letter to that person anymore now this law applies to debt collectors not an original creditor so technically if a person had a credit card and they were current on it um the that law doesn't apply to an origin to a to a an original creditor like a but sometimes there's state laws that provide for that uh even when an original creditor gets what's called a cease and desist letter they normally honor it they may continue to send a bill but uh but yeah seniors don't have to be bothered by by debt collectors anymore they can they can be protected and the law provides for that and you know that's what we do it helps if a senior is struggling with debt and can't pay their bills how can they afford a lawyer like you so i probably did what 30 40 000 bankruptcies before i started helps a little over 10 years ago uh and i saw there was a lot of seniors that you know their income was protected they didn't need to pay the stat they were low income or poor they couldn't afford a bankruptcy uh and i knew that they could send out a cease and desist letter but you know that's kind of hard for a senior to do and then they got a lot of questions on top of that and so helps was founded to represent lower income and poor seniors who have debt they can't afford to pay as their attorney so they don't have to deal with debt collectors and the only way i knew it worked we would have to be what's called a 501c which would be a charitable organization so what that means is that um about one out of four or one out of five of our clients get our help for free okay they don't have to pay anything we don't we never turn anyone away that needs our help but for a lot of seniors that have a income we charge a very modest fee an example would be twenty dollars a month for twelve months then ten dollars a month it might be thirty dollars a month for 12 months then ten dollars a month but um it's very not very much uh and then they contact us we can enroll them in our program uh literally over the phone in just a few minutes uh and click a button and they'll get an email from us confirming they're a member of helps and then they give us the people they don't want to hear from will within 24 hours we send out what's called a cease and desist letter to the to their collectors telling them that this person can't afford to pay him anymore don't bother him if you if you have any questions contact us that helps so that's what we do we represent seniors uh and disabled persons who have debt they can't afford to pay as their attorney so they have to deal with debt collectors but you know people can do this on their own but you know i talk to a lot of seniors they don't want to do it on their own uh it's you know it's so that's the way it works and in order for this to work the representation has to be ongoing because a lot of times debt collectors will sell the account to a new collector uh so if you know if they can't collect they're gonna sell it to joe down the road and so senior might get a letter six months a year two years down the road uh from a new debt collector when that happens the senior just calls us on the phone or lets us know we'll send out a cease and desist letter to that new debt collector in the meantime if they're ever called you know they refer them to helps they say hey i'm represented by an helps non-profit law firm you know you cannot legally call me anymore and you hang out so that's what we do and what what we're here for is to you know answer the questions assure them uh provide legal information so they know their rights you know a debt collector will never tell us you know their income is protected never and you know they're happy to sue them uh and you know senior file lawsuit hoping that the senior will be intimidated trying to try to pay them when in fact the senior doesn't have to pay them because their income's protected they're safe and their assets are protected so if someone did want to avail the sales of your services how would they contact health our website www.helps dot h-e-l-p-s-i-s-h-e-r-e help stands for help eliminate legal problems for seniors okay and disabled persons and then our phone number is 855 helps helps us helps us or helps us uh and then call us on the phone visit our website um we spend hours on our website we have lots of articles and we have a youtube page too um and we're there to answer questions and provide information you know our second purpose jeff is to educate seniors especially lower income seniors and poor seniors how they can maintain their financial independence because that's what it boils down to uh the seniors have this limited amount of money they need to protect it so that they can be independent financially if they think they have to use all their money to pay their bills and they have a ton of debt then it's extremely distressful and it doesn't need to be that way well i think you've educated a lot of seniors today thank you very much for your time thanks for having me jeff i really do appreciate it [Music]

Channel: SeniorLiving.Org

Views: 74,456

Keywords: struggling seniors, struggling senior, seniors, senior living, senior finance, bank account, senior bank account, pension, protect pension, pension protection, bank account protection, social security, social security benefits, va benefits, debt collectors, debt collectors call, cease and desist letter, stop debt collector calls, stop debt collectors, senior citizen, debt, judgement, judgement-proof, eric olsen, jeff hoyt, protect your social security, Seniors in debt

Id: UZ2OOQ7OvRw

Length: 24min 59sec (1499 seconds)

Published: Thu Oct 07 2021