Clear Money Guide
What this guide covers
A quick view of the questions and evidence developed below.
Updated August 3, 2026. Quick answer: it depends on the account type and, for IRAs, on your state. Employer plans covered by ERISA carry the strongest protection in the system — a federal anti-alienation rule. IRAs are protected by state law outside bankruptcy, and that protection ranges from unlimited to a discretionary case-by-case standard. Social Security is protected by its own statute and is the sturdiest of all.
The three regimes, kept separate
- ERISA employer plans — 401(k), most pensions. Federal anti-alienation protection, strong and uniform, with narrow exceptions (a QDRO in divorce, federal tax claims, certain criminal restitution). This is why rolling a 401(k) to an IRA can quietly reduce creditor protection depending on where you live.
- IRAs — outside bankruptcy this is state law, and it genuinely varies. Some states protect an IRA fully; California protects it only to the extent necessary to support the debtor in retirement, which is a discretionary standard rather than a dollar figure. The state table, read from the statutes (archived: DOI 10.5281/zenodo.21762840).
- Social Security and other federal benefits — protected by 42 U.S.C. 407, and reachable only by statutes that expressly reference it. which is why the exception list is short and closed.
The bankruptcy-versus-ordinary-creditor split almost everyone misses
These are two different systems and the same account can be treated differently in each. Bankruptcy has its own federal exemption scheme with its own IRA cap; an ordinary judgment creditor outside bankruptcy is governed by your state’s exemption statutes. An article that does not say which regime it is describing is not usable, and most do not say.
Your house is a separate question again
Homestead protection against creditors is state law and ranges from a few thousand dollars to unlimited, with two big states capping acreage rather than value. It is unrelated to senior property-tax relief despite sharing the name — the creditor table (archived: DOI 10.5281/zenodo.21762835), and separately the property-tax programmes.
Protection is one piece of a wider plan
How well an account is shielded depends on the account type and on your state, and an adviser can weigh that alongside the tax and withdrawal consequences of moving money between accounts.
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What actually changes the answer
- Where you live, for anything that is not an ERISA plan.
- Whether you roll over. Moving an employer plan to an IRA changes which regime governs. In a weak-IRA state that is a real trade against the wider investment choice.
- Whether the money has left the account. A protected account distributing into a bank account is a different question, which is where the two-month rule takes over for federal benefits.
- Inherited accounts are their own category, and the Supreme Court has held an inherited IRA is not the same thing as a retirement account for bankruptcy purposes.
Social Security sits outside all of this under its own federal statute — what can and cannot reach Social Security.
This page exists so you know which rulebook applies to which account before you need it. It is not a guide to defeating a creditor who is owed money — the protections here are the ones the law already gives you, and they are worth knowing precisely because they are usually discovered too late.
Federal rules read from 31 CFR part 212 and 42 CFR 483.15 via the official eCFR, and 42 U.S.C. 407 and 659 via the U.S. Code, all at source on August 3, 2026. General information, not legal advice. If you are facing collection or a lawsuit, a legal aid office or an attorney licensed in your state is the right next step — we do not sell referrals to either.
A federal tax levy is one of the narrow exceptions to the general protections, and it has a statutory ceiling — a continuous levy reaches up to 15 percent of a specified payment.
If the protected accounts are most of what you have, the practical position has a name: “judgment proof” is not a status you apply for — it describes a creditor having won and there being nothing it can lawfully take.
Homestead exemptions, state by state. Retirement accounts are one shelter. For most households the larger one is home equity, protected by a state homestead exemption that is separate from anything above. These guides give the protected amount, whether you have to file anything to get it, and how a married couple is treated, each read from that state’s own statute: Alaska, Connecticut, District of Columbia, Delaware, Iowa, Idaho, Kansas, Maine, North Dakota, Nebraska, New Hampshire, Nevada, Rhode Island, Utah, Vermont, West Virginia, Wyoming. Start with the 50-state homestead overview.
Eight more states, read from their own statutes. This tranche adds the homestead exemption for eight states that were not previously covered: Missouri, Arkansas, Georgia, Louisiana, Montana, New Jersey, Oklahoma, South Dakota. Each gives the protected amount, whether a filing is required, and how a married couple is treated. Start with the 50-state homestead overview.