How Will Finances Change After a Divorce?
Few things out there can throw a wrench into a person's financial stability like a divorce. From the loss of a second income to extra expenses to lost assets - most couples are ill prepared for what happens after the divorce is finalized. If you have gone through a divorce or you are about to, it is imperative you prepare yourself for the finances post-divorce. Even if you feel as though your finances can never be recovered, realize that even the direst financial situations can be overcome - as long as you create a plan of attack.
Establish a Budget
Budgeting is extremely important after a divorce. It is what establishes income and outgoing expenses - and helps you plan each month. If you were used to living comfortably on two incomes and now are down to one, you need to make sure you allocate your funds properly for your housing, food, regular bills and spending. Even if you haven't yet started working after your divorce, it's still importantto create a budget based on any spousal and child support you will receive. This will help you to better plan your expenses until you are able to start working and earning a living again.
Rebuild Your Credit History
Most couples do not realize that their credit history and score will take a significant hit after a divorce. From credit accounts that are closed or transferred to accounts that are discharged in bankruptcy, you may notice your credit score is significantly lower post-divorce. You will want to re-establish your credit as soon as possible by:
- Obtaining a credit card - if you cannot qualify for a regular card you may need to apply for a secured credit card until you establish ample payment history.
- Once you have credit, you need to work hard to keeping it. Never miss a credit card or account payment. Remember, late payments can quickly lower your score. You will also want to be cautious about balances and never get close to maxing out your credit card limits.
- Check your credit report monthly to make sure creditors are reporting accuracies and that no one attempts to steal your identity or take out a credit card in your ex-spouse's name with you as a co-signer.
Repaying Marital Debts
As part of your divorce settlement, each spouse will be assigned marital liabilities and debts. If you are responsible for certain accounts, it is imperative you repay those debts as required. Creditors are often willing to work with you if you are experiencing a financial hardship. When repaying those marital debts, you will want to keep a few things in mind:
- Have a plan for how you will handle those creditors in the future - if you are keeping the accounts open after they are repaid.
- Do not make promises to creditors that you cannot keep. If you promise to repay in a specific plan, keep to that plan.
- Keep records of all payments you make, when you make them, and get confirmation numbers to prove that you have paid the debts.
- Be persistent and even try to speak to a supervisor to get assistance with interest rates and late fees on your marital debts.
Contact a Divorce Attorney
If you are facing a divorce, contact the New Hampshire divorce lawyers at Lucas Law PLLC. We can assist you with your divorce and even help you determine how you will handle your finances after divorce. Call us today for a free consultation. Related Resources :