Divorce means the end of a relationship and the deepest commitment in the world, but it also has a very practical financial aspect. It means the loss of income, which could be substantial depending on the family. If both spouses work, each is facing life with only half the income he or she had previously. The expenses may be halved as well, but people change their lifestyles and living conditions based on their experiences, and it’s not easy to make that kind of change.
This is especially true if there are children. The parents have to work out how to take care of the children and who will provide for them, which may mean that one parent is caring for three people with one person’s income. That can be a real hardship.
Many divorces proceed along a 50/50 split, dividing up the marriage’s accumulated assets along equal lines; however, depending on the circumstances of the divorce, one party may get much less. The threat of bankruptcy, overwhelming debt, even poverty, becomes very real.
This is why it’s critical for people heading into a divorce to understand their personal financial situation, and what could be the worst possible outcome of the financial side of the split. Credit card accounts, home mortgages, student loans, investment plans—all must be understood.
Many people seek out a professional for help. Divorce lawyers can help each person to get the best they can out of the deal; accountants can help people get a handle on their financial situation.
It’s easy to get lost in the emotional tangle of divorce, and it can be truly ugly and heartrending. The cold economic reality is that bills have no respect for divorce or any other loss and still demand to be paid. Anyone in the midst of divorce must be adequately prepared.
