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- Judgment-creditors cannot, generally speaking, garnish VA benefits or military pensions.
- Administrative garnishment for child or spousal support may be allowed.
Can my military pension or VA benefits be garnished?
I have a car that has been repossessed. They say that i owe the remaining balance of $8,000. I lost my job. They say they can garnish my wages and I am retired from the military. They say they can take my military check. Is this true?
Generally speaking, VA benefits and military pensions are not subject to execution, levy, attachment, garnishment, or other legal process. However, there are exceptions for child support and support of divorced spouses.
Active military and other federal employees are subject to garnishment for what the federal government calls "commercial debt." However, I can find no laws that allow garnishment of military pensions or VA benefits, aside from the IRS’ authority to do so.
Direct-deposit your pension benefits into a separate account that contains funds from no other sources. Ask your bank or credit union to place a notation on that account stating the funds in that account are pension benefits not subject to attachment.
See the Bills.com resource Military Debt Consolidation to learn how to resolve debt if you are an active service member.
I hope this information helps you Find. Learn & Save.
Best,
Bill
Debt statistics
Debt is used to buy a home, pay for bills, buy a car, or pay for a college education. According to the NY Federal Reserve total household debt as of Q4 2023 was $17.503 trillion. Auto loan debt was $1.607 trillion and credit card was $1.129 trillion.
A significant percentage of people in the US are struggling with monthly payments and about 26% of households in the United States have debt in collections. According to data gathered by Urban.org from a sample of credit reports, the median debt in collections is $1,739. Credit card debt is prevalent and 3% have delinquent or derogatory card debt. The median debt in collections is $422.
The amount of debt and debt in collections vary by state. For example, in Nebraska, 18% have any kind of debt in collections and the median debt in collections is $1972. Medical debt is common and 6% have that in collections. The median medical debt in collections is $653.
Avoiding collections isn’t always possible. A sudden loss of employment, death in the family, or sickness can lead to financial hardship. Fortunately, there are many ways to deal with debt including an aggressive payment plan, debt consolidation loan, or a negotiated settlement.
