Building Financial Security After Divorce
Couples often list financial problems as the number one reason why their marriage failed. But money problems don’t just go away after you divorce. In fact, they’re compounded. It’s just that the animosity that’s built between couples after years of struggling financially takes its toll, and now that marriage is no longer salvageable. The question then becomes: How do you rebuild your finances after divorce?
Why divorce is hard on your finances
Married couples rely on one another for just about everything. Even things that you didn’t think of, like health insurance, can radically change if your health insurance was provided by your partner’s employment. Now, you’ll also be supporting yourself. Whereas once your finances could be pooled to pay for the expenses of a single household, now, those finances are split between two households. And you still have expenses related to your children.
To be sure, assets are not the only thing that is distributed in a divorce. Debts too become part of the marital estate and those will also need to be distributed. It’s for this reason that many couples file for divorce and bankruptcy together. Bankruptcy often becomes the last experience that the couple has together as husband and wife.
Building financial security after divorce
There’s no trick to rebuilding your finances after divorce. You’ll need to adjust your spending to the reality of your new situations and figure out a way to handle any debts that were assigned to your estate once the divorce is finalized. In some cases, the only way to handle those debts is bankruptcy, but once you file, you will need to start rebuilding your credit. In other cases, a former spouse may be able to refinance or consolidate their debts, but only those with sterling credit will be afforded the opportunity.
So in a lot of situations, a spouse will be forced into bankruptcy to discharge debts they cannot pay and then try to rebuild their credit from there. Other spouses find themselves without any credit cards or credit accounts in their name. In these cases, it can be difficult to establish credit once you’re separated from your spouse.
In most cases, rebuilding your finances will mean rebuilding your credit. This may require paying down the balances on outstanding accounts, but if you have outstanding accounts, you’re still in a better position than someone who has no credit to their name or recently filed for bankruptcy.
Those who have credit cards with multiple names listed on them may want to request the removal of their spouse’s name. That will place the credit card solely in their name and help them show a credit history when applying for more.
The bottom line is that many folks do rebuild their credit after a divorce and successfully resolve debts from their marriage. It takes a concerted effort and a little bit of time, however.
Talk to a West Palm Beach Divorce Lawyer Today
If you’re ready to untie the knot but concerned over your finances, the West Palm Beach divorce lawyers at the office of Bruce S. Rosenwater & Associates can help you separate your finances from your partners and then plan for your future. Call today to learn more about how we can help.
