Watching your finances spiral out of control is stressful, but if things get to the point where you are having wages garnished, you may find yourself struggling to make ends meet. If you have fallen behind on child support payments, credit card bills o something similar, you stand to lose some of your paychecks as a result.
According to Nerdwallet, wage garnishment occurs when a creditor secures a court order against you in response to overdue debt. Sometimes, you may have wages garnished without a court order, depending on the type of debt you have outstanding. The garnishment means that your employer must withhold some of your paychecks and use the money to pay your creditor until it receives everything owed.
So, exactly how much might you lose when you have wages garnished? If your debts are from medical bills, credit card bills, a personal loan or another common type of consumer debt, you should expect to lose less than you would if your debts involve back child support or alimony payments. For most consumer debts, expect to lose either 20% of your weekly paycheck or the amount by which your income exceeds 30 times today’s federal minimum wage – whichever is lower.
Child support and alimony debts
If you are having wages garnished due to past-due child support or alimony, you stand to lose as much as 60% of your weekly paycheck. If you are responsible for supporting a spouse or other child, though, you may lose 50% of your weekly paycheck to wage garnishment.
Wage garnishment may prove embarrassing, but you may have options available to you that could put a stop to your garnishment. When you file for bankruptcy, something called the automatic stay kicks in. During this time, your employer may no longer garnish your wages to pay creditors.