We can't ignore the fact that the retirement climate isn't exactly stable for seniors. While some people's careers have enabled them to have a cushy retirement, that's not the case for all older Americans.

Some have been forced into early retirement, some were aged out of the workforce before they saved enough up, while others' careers simply didn't allow for a good retirement.

It's no secret that most of us can't live on Social Security alone, so with all of the variables, it's understandable why some seniors are struggling to make ends meet.

Declaring Chapter 7 Bankruptcy

Let's say work dried up and all Joe, 67, wants is his financial peace and quiet back. With nothing but his small Social Security check to live on, he's getting deeper into debt by the day. So, he declares Chapter 7 bankruptcy to erase his medical bills and credit card debt.

Getting over the stigma of filing for bankruptcy is usually the hardest part for seniors like Joe. However, bankruptcy offers the chance to hit the financial reset button, even if you're in your 60s, 70s or beyond. If you're like Joe, you probably want to leave money, not debt, to your children and grandchildren.

How Bankruptcy Protects Assets

When seniors spend retirement assets to pay off debts, they risk a downward financial spiral that can be difficult to recover from compared to when they were younger. A better financial strategy is to protect one's assets at all costs.

How does this work? Retirement savings and income are usually untouchable during the bankruptcy process. That means that pensions, 401(k)'s, IRAs worth up to $1.245 million, Social Security and qualified profit-sharing plans are exempt from creditors.

What's more, retirees can usually protect their homes from foreclosure by using the homestead exemption, which protects the equity in their primary residence.

If you'd like to learn more about how bankruptcy can protect your assets, contact a qualified bankruptcy attorney near you.