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Single Again: How to Financially Survive a Divorce
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For more information contact:
Kelly Rote (713) 394-3201 |
Release Date: August 4, 2004 |
MMI offers tips for the newly single on how to reevaluate their finances to make it work
Eighty percent of people who divorce cite financial problems as a contributing factor. Ironically, the financial problems that result from divorce may be even more severe. It is crucial that people consider their financial situation in this time of transition.
After a separation, pull a copy of your credit report. Review entries carefully and close all joint accounts or convert them to individual accounts. Alert secured lenders of your marital status and instruct them not to allow any changes without your permission. Consider “freezing” joint bank accounts and dividing funds into individual accounts.
“Develop a plan to pay off your debts prior to your divorce, as your divorce decree is an agreement between you and your spouse—not your creditors,” said Kelly Rote, communications manager for Money Management International (MMI). “Whoever is responsible for the debt during the marriage may still be obligated after the divorce. “
After a divorce is final, allow time to pass before making major financial decisions. When you are ready, there are a few things you can do to move forward financially.
-Re-evaluate investment strategies. You will probably change your investment strategies to support your new lifestyle. Re-establish a safety net by continuing or starting to contribute to a 401(k) plan and a savings account, and consider setting aside an emergency fund.
-Determine necessary financial tasks. Although you may take time to recover, don’t neglect paying your bills, which could result in late fees and a negative credit rating. Establish a procedure to pay bills, make deposits and withdrawals, get cash and pay taxes.
-Create a new spending plan. Changed circumstances call for a new budget. Note differences in income and expenditures and adjust your spending accordingly.
-Set goals. Most likely, your experience changed your financial priorities. Decide what you would like to do with your money and put a plan in place to make your goals a reality.
Finally, enlist help and support from your family, friends and community. For help repaying your debts or adjusting to your new financial circumstances, visit the credit experts at www.moneymanagement.org.
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Money Management International, is a non-profit community service organization that provides confidential financial guidance, counseling and debt management assistance to consumers. MMI helps consumers trim their expenses, develop a workable budget, lower their debt payments and repay debts. Services are available by phone. To visit with an MMI counselor, call toll-free 1-800-762-2271- 24 hours a day, 7 days a week. Spanish speaking counselors are available. Consumers can also learn more by visiting the MMI home page at www.moneymanagement.org.
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