How Can I Avoid Bankruptcy After an Illinois Divorce?
Posted on April 20, 2020 in Divorce
A recent survey found that 39% of people state that debt and other financial issues were a major factor that contributed to their divorce. It is no wonder that bankruptcy and divorce are so closely linked—not only can divorce itself often cost more money than many people expect, but the financial ramifications of the divorce are felt long after the proceedings are complete. From the division of marital debt to simply adjusting to living on a single income, life after divorce can get expensive. But that does not mean you have to file for bankruptcy. Here are some tips for keeping your finances in order after your marriage has ended:
6 Ways to Prevent Bankruptcy Following Divorce
While there are some things you can do to avoid bankruptcy that are common to just about any person, divorced or not, there are also some special things that you can do to protect yourself against bankruptcy when you are divorced. Some examples include:
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Increase Your Income—This is probably one of the very first tips a financial advisor will tell you if you are considering bankruptcy. Are there any ways for you to increase the money you make? The more money you have coming in, the less likely it will be that you will drown in debt. You may want to take on extra jobs (part time or otherwise), seek a promotion or a raise at work, rent out your house, sell your valuables, or borrow from family and friends if necessary.
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Decrease Your Spending—Another obvious option to avoid bankruptcy is to decrease your expenses. You can do this by drawing up a budget and sticking to it. Focus on the necessities in your budget and be realistic in terms of what you can afford. If you already have a budget, revise the budget and do your best to eliminate anything you do not need.
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Readjust to Being Without a Partner—A common problem that divorced people face is making the appropriate adjustments to their lifestyles. When you were married, you and your spouse pooled your finances and resources. You were probably able to afford more discretionary spending in your lives because you had two incomes and shared expenses, such as those associated with your house or apartment. Now that you are single again, you might want to reconsider how you will live your life. This could include relocating to somewhere cheaper, holding off on buying a new car, spending fewer nights on the town, or cooking meals at home rather than eating out.
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Remarry—You can always get back into the dating scene and find a new partner. This can help restore the sense of financial security and comfort you had before your divorce. However, you should keep in mind that if you rush into a new relationship before you are ready, you might end up divorced yet again.
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Restructure Your Mortgage and/or Renegotiate Your Debts—Divorced people, married couples, and single people alike can stave off bankruptcy by restructuring their mortgages or negotiating their debts. Overall, most financial institutions are interested in negotiating with you, because they would rather get more money from you now than receiving nothing from you later if you file for bankruptcy.
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Hire the Right Divorce Attorney from the Start—Here is the best advice we can give to you if you really want to avoid bankruptcy after divorce: seek legal representation from the right attorney at the beginning of the divorce process. If you find the right attorney, you can ensure that the terms of the divorce will be to your benefit, including making sure spousal support or child support payments will meet your needs and maintaining ownership of valuable assets during the division of property.
Contact a DuPage County Divorce Lawyer
Divorce is a big enough life event in itself, and you will not want bankruptcy to complicate things even further. Hire the right Wheaton family law attorney from the start of your divorce. If you enlist the help of the knowledgeable team at Andrew Cores Law Group, you will receive valuable, affordable legal counsel, ensuring that you will be awarded the optimum financial benefits from your divorce agreement. Call us at 630-871-1002 for a free consultation.
Sources:
https://finance.yahoo.com/news/debt-com-survey-divorced-americans-134500285.html
https://money.usnews.com/money/blogs/my-money/2012/05/16/5-ways-to-avoid-filing-for-bankruptcy
https://globalnews.ca/news/3377381/heartbroken-and-bankrupt-why-divorce-can-destroy-your-finances/
