Military veterans can be vulnerable to financial struggles after they return to civilian life. According to U.S. Census data:

• Approximately 125,000 veterans filed for bankruptcy in 2017;
• Veterans accounted for 14.7 percent of the people who filed for Chapter 7 bankruptcy; and
• Veterans accounted for 15 percent of the people who filed for Chapter 13 bankruptcy.

Disabled veterans, in particular, may struggle to find and keep employment and often rely on their veteran’s disability benefits. A federal law enacted in August provides new protections from creditors for those disability benefits when a veteran files for bankruptcy. 

The HAVEN Act

The Honoring American Veterans in Extreme Need (HAVEN) Act was signed on Aug. 23, after the bill passed both chambers of Congress with bipartisan support. The act states that specified federal disability payments for veterans will be excluded when calculating a bankruptcy filer’s income. Qualified disability benefits include: