Your Company Went Bankrupt: Now What?

The same rules apply to employer-sponsored 401(k) plans. Most of those funds are not likely to be affected by bankruptcy since they belong to the employee and not the company. But if the employer is behind in making its contributions to employee plans, then staff could lose out on the money that is owed to them.

One spot of good news is that employees who lose their job through bankruptcy will be eligible to collect unemployment.

“Anyone who is laid off is eligible,” Mandelman says.

For more on unemployment and recent job trends, check out these MainStreet articles.

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