According to a recent report by MSNBC.com, divorce is one the leading causes of bankruptcy in this country. Divorce can take a major toll on your finances if you do not plan carefully prior to marriage and if you do not act quickly once the marriage has ended. The article provided several tips on how to make sure that your finances remain intact after the marriage has fallen apart.
- Obtain a copy of your credit report. It is important that you carefully inspect your credit report for errors that could lower your credit score, especially if you will be taking out a new loan for a home or car after the divorce.
- Separate the credit. Make sure that you are no longer listed as a co-owner on the former spouse’s credit card. If you still remain as a co-owner, you are still liable for the charges that accrued on the card. The best thing to do is to close all joint accounts once you get divorced.
- Examine and manage your debt. Revise your budget based on your post-divorce income and make the necessary adjustments to ensure that you do not get overwhelmed by the debt. Cut back of spending if necessary.
- If bankruptcy is the only option, start rebuilding credit early. “Neil Colmenares, a New York bankruptcy attorney, recommends taking out two credit cards and paying them off in full each month. Barring any other debts, after one year your credit score ‘should be pretty good,’ he says.”
There are also steps you can take to prevent a financial decline when walking down the aisle a second time. People that are marrying for the second time should have a conversation with their future spouse about their finances. It is also advisable that they sign a prenuptial agreement to divide the financial assets. If you find yourself facing a messy financial battle post-divorce, you need the help of an experienced South Carolina family law attorney to guide you through the messy process.
Source: “Could an ex-spouse ruin your credit?,” by Kimberly Palmer, published at MSNBC.com.
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