No one likes divorce, but it’s very common in the U.S: according to the U.S. Census Bureau, 813,862 divorces or annulments were granted in 2014. No one really has an exact figure, but the American Psychological Association estimated that 40-50 percent of first marriages end in divorce. You might think that people with experience would do better in subsequent marriages, but this is not so: 60 percent of second marriages end in divorce, and 73 percent of couples in their third marriage do not make it.
Besides a desire to stick out commitments made, and religious values and children, often the reason couples stay together is financial, as two incomes can better pay the bills. However, if married life is just not workable, spouses may have to bite the bullet and tough out the drop in monetary status.
It may have been a tough fight during the divorce legal battle to keep ownership of a home during divorce proceedings, and now that the dust has settled, you may realize it’s actually a big burden. Why would someone fight to keep something they can’t afford? Oftentimes, in highly charged situations like divorce, emotions can get the better of us, and as the saying goes, you can’t see the forest for the trees. Some emotional reasons a spouse wants to keep their house: years of effort may have been involved getting the house to look and function just so; you may feel that raising kids in a house instead of an apartment will be better for them in the long run. Another reason you may want to hang on to the house: you don’t think you can qualify for it on your own and may not be able to buy a house in the near future but if you keep the one you have now, “you’ll find a way to pay for it.”
Often times in a marriage, couples will have joint credit card accounts and the responsibility for the cards is divided up between the spouses during the divorce. However, even if the court says a credit card balance is your ex’s responsibility, you may still be liable. If your ex does not pay on the joint credit cards, you may still get late pay reflected on your credit report and your credit may suffer. To protect your credit, you may need to make payments on balances you were not assigned in the divorce in addition to the ones which were declared your responsibility.
You may feel like you already know you’re in trouble without having to write it all out, but in order to get a grip on your financial life, it’s still worth it to list out your total income and debt so you know what you have to work with. It helps to divide up your income and expenses: in one column, your monthly income after taxes. In a second column, list all of your monthly payments for your debts. In a third column, write down your monthly living expenses: entertainment costs, gas, insurance, phone bills, groceries, and utilities. In a fourth column, write down any monthly child support or alimony that you have to pay.
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