debt and divorce
The emotional side of divorce can take its toll, but the financial process can in fact be one of the most stressful aspects of separation, and dividing up any debts from the marriage can leave a huge dent in your bank balance.
Since the whole process can be costly, both in financial and emotional terms, there has been a move towards a more amicable approach to sorting out the terms of a separation. There are some simple rules on how to approach dealing with household debts following a breakup.
Once you've identified your debts and taken steps to ensure they don't increase, it's time to decide who will be responsible for what debt. There are several ways to do this, including:
If possible, pay off the debts now. If you have savings or assets you can sell, this is the cleanest method. You don't have to worry that your spouse will leave you responsible for his/her portion of the debt, and you can start your new life debt-free.
Agree to take responsibility for the debts in exchange for receiving more assets from the division of your property.
Agree to let your spouse take responsibility for the debts in exchange for receiving more assets from the division of property.
Agree to share responsibility for the debts equally. This leaves you the most vulnerable, because your spouse could stick you with the total debt. Legally, you are responsible if your ex-spouse doesn't pay up, even if s/he signs an agreement taking responsibility for the debt
To avoid arguing over child support / spousal support you must ensure that you have copies of all relevant documents that show your husband's / wife's financial ability to pay. Such documents include bank statements, deeds to assets such as properties, shares and investments, payroll and tax returns.
For the recently divorced, taking care of these potential problems is another step toward putting your divorce behind you. Spend time adjusting your financial accounts as necessary, and be sure that your money management reflects your new lifestyle. If you don't, the grueling ordeal that can be divorce could get alot uglier.
The UK Insolvency Helpline Debt Advice Service
The UK Insolvency Helpline is a UK based personal and business debt consultancy offering advice to consumers and businesses on financial problems. The dedicated aim of the service is to provide clients with a caring, professional hands on approach to financial problems with the ability to identify and resolve problems at an early stage.
If you require advice on debt or need to talk to someone confidentially about your options, there's no need to wait or book an appointment, The UK Insolvency Helpline's Advisors are available Monday to Friday 8am to 8pm and Saturday 9am to 9pm on 0800 074 6918.
Call 0800 074 6918 or online at www.insolvencyhelpline.co.uk
