I wrote earlier in this series about Minnesota's homestead exemption — the rule that protects your home from creditors — and argued we should push it back toward the unlimited protection our own state offered for its first 135 years. This is the companion piece, because a home isn't the only thing a creditor can come for, and here Minnesota is a good deal stingier than most people realize.
When someone falls behind — a medical crisis, a job loss, a divorce — the law decides how much of their remaining life a creditor gets to strip. Those rules are the exemptions, and in Minnesota they're frozen thin.
What you actually get to keep
Under Minn. Stat. § 550.37, here's the protected list for an ordinary Minnesotan:
- One motor vehicle: $10,000. (More only in narrow cases — up to $12,500 if the car is a tool of your trade, or higher if it's specially modified for a disability.)
- Household goods and electronics: $12,150 total.
- Tools of your trade: $13,500. Farm machinery: $13,000.
- Jewelry: $3,308. Household tools like a lawnmower and snowblower: $3,000.
- Retirement accounts: $81,000 of present value, plus more if "reasonably necessary" for support.
- And in a bankruptcy, a "wild card" — any property you choose, including cash in the bank — of just $1,500.
Read that last one again. If you file bankruptcy in Minnesota, the amount of plain cash or miscellaneous property the law lets you shield is fifteen hundred dollars. In a lot of states the wild card is $5,000, $10,000, even $25,000, or lets you pour an unused homestead exemption into it. Ours is among the thinnest in the country.
And the $10,000 car exemption? Try buying a reliable used vehicle for $10,000 in 2026. For most working people, the car is the job — it's how you get to the shift that digs you out. Protect too little of it and the law repossesses the very thing a person needs to repay everyone.
Why the numbers keep falling behind
The statute does adjust for inflation — but only in clumsy 10-percent steps, every two years, and only once cumulative inflation crosses a full 10-percent threshold (§ 550.37, subd. 4a). So the real value of what you're allowed to keep erodes for years between bumps, then lurches. A protection that lags inflation is a protection quietly shrinking every year the Legislature looks away.
The one place Minnesota does well — wages
Credit where it's due, because I promised you both sides. Minnesota's wage-garnishment protection is genuinely solid. Under § 571.922, a creditor can take at most 25 percent of your disposable earnings — and less for lower earners: only 15 percent, or 10 percent, as income drops toward the floor, with a hard exemption pegged to 40 times the minimum wage. Public-assistance income and the earned-income credit are fully protected. On wages, Minnesota already does more than federal law requires. It's the property exemptions — the car, the wild card, the tools — that are stuck.
The economic case (it's the same as the homestead case)
Here's why raising these isn't softness, it's sense. When exemptions are too low, the marginal dollar a creditor claws back is tiny — but the damage is large: you take a family's only car, its work tools, its small cash cushion, and you don't meaningfully pay down a five-figure debt; you just convert a recoverable household into a dependent one. That's a bad trade for everyone, the creditor included, because a person with a car and their tools goes back to work and pays; a person stripped of both goes on assistance. The point of an exemption isn't to cheat creditors — it's to keep a stumble from becoming a permanent fall.
I'll concede the counter-argument honestly, as I did on homestead: exemptions set very high can raise the cost of credit at the margin, because lenders price in what they can't reach. That's a real tradeoff. But Minnesota isn't near that edge — a $1,500 wild card and a $10,000 car aren't "too generous," they're a generation out of date.
What we can do
Raise the wild card and the vehicle exemption to reflect 2026. A meaningful bankruptcy wild card — in line with generous states — and a car exemption that actually buys a working car. These are the two that most directly decide whether a family recovers.
Fix the inflation ratchet. Index the exemptions to rise smoothly every year, not in delayed 10-percent lurches. Protection shouldn't quietly shrink between legislative sessions.
Keep the wage protection, and guard it. The garnishment brackets are good policy. Don't let them erode.
Why should we do less for the people of Minnesota than Texas or Florida does for theirs? On the homestead, and on the humble car in the driveway, the answer should be: we shouldn't.
First the facts. Then the fix.
Sources
Minn. Stat. § 550.37 (Property Exempt), verified against raw text at revisor.mn.gov: motor vehicle exemption of $10,000, with $12,500 for a trade vehicle and higher amounts for disability-modified vehicles (subd. 12a); household goods and consumer electronics of $12,150 and jewelry of $3,308 (subd. 4); tools of the trade $13,500 (subd. 6) and farm machines $13,000 (subd. 5); retirement/employee-benefit plans to a present value of $81,000 plus amounts reasonably necessary for support (subd. 24); household tools and equipment $3,000 (subd. 27); the bankruptcy "wild card" of $1,500 (subd. 28); and the inflation-adjustment mechanism operating in 10-percent increments in even-numbered years (subd. 4a). Minn. Stat. § 571.922 (Limitation on Wage Garnishment), verified against raw text: the 25 percent / 15 percent / 10 percent garnishment tiers by income and the exemption floor tied to 40 times the state or federal minimum wage. Companion analysis and the economic tradeoff (higher exemptions and small-business ownership vs. credit cost) cross-reference this series' homestead-exemption articles.
Comparative wild-card and vehicle-exemption figures for other states are described in general terms and were not tabulated from primary sources this pass. Corrections: campaign@madgettformn.com.