When Personal Bankruptcy Leads to Divorce. Saving Your Sanity and Your Bank Account
So, you are thinking of declaring personal bankruptcy and are married. You have heard the conspiracies surrounding bankruptcy and divorce, and are becoming a little worried over how your debt will affect your marriage. You want to know whether these rumors are true, and whether declaring personal bankruptcy really does lead to divorce.
Declaring personal bankruptcy and divorce seem to go hand in hand these days, and, like the classic chicken or the egg scenario, it is often confusing which comes first.
Declaring Personal Bankruptcy and Divorce
According to www.divorcerate.org, half of all marriages in America end in divorce. This number is quite staggering, and only becomes worse in second and third marriages. Many times, these divorces often occur at the same time as the bankruptcy cases. According to the www.examiner.com, 32% of Americans file personal bankruptcy every year. There are two reasons for this.
- Bankruptcy Leads To Divorce- Declaring personal bankruptcy can be stressful for couples. As you and your spouse review all of your debt, this review may shed a light on communication and financial problems you never knew you had. You may argue over the stupidity of buying that second home while your spouse continues to justify the expenditure. Many times, a marriage is a balanced concept: one spouse is a spender while the other is a saver, verifying the phrase ‘opposites attract.’ During bankruptcy, this creates the perfect storm of marital and financial problems, often ending in divorce.
- Divorce Lead to Bankruptcy- If a couple has filed for divorce already, they may often find themselves contemplating declaring personal bankruptcy. This is typically because they are left with a significant amount of debt after the divorce and only half of the income. The divorced individuals must pay for two households at the same time as they split the bills from their marriage, and it can prove to be too much.
Saving Your Sanity and Bank Account When Declaring Personal Bankruptcy
For many couples, the thought of declaring personal bankruptcy at the same time as a divorce is a bit overwhelming. Before this leads to another fight though, try communicating and determine whether bankruptcy is going to truly lead to a divorce, or whether you can avoid a divorce while still declaring personal bankruptcy.
- To avoid a divorce caused by financial stress, consider creating a budget and a few spending guidelines for when your bankruptcy is complete. If you and your spouse can both stick to the budget, you may be able to avoid turning your financial problems into a divorce or second bankruptcy case.
- Communicate, communicate, communicate. You can prevent stress between you and your spouse by taking the time to communicate about your financial situation. Discuss how you are going to spend your money, why you need to spend it on certain items, and what you can do to reduce spending.
- Don’t play the blame game. Often couples who are considering divorce blame the other spouse for their current situation. A marriage is an equal partnership and you are just as responsible for your finances as your spouse is.
- If you decide that divorce is the best option, keep communicating. If one spouse decides to declare personal bankruptcy after a divorce without the knowledge of the other spouse, creditors can go after the other spouse once the debt is discharged. By communicating, both of you can work together to get rid of the debt for good.
Divorce and declaring personal bankruptcy often go hand in hand. Make sure understand how financial stress can affect your marriage before you decide to declare personal bankruptcy.