Getting through a divorce is one of the most challenging situations in life. It can be both emotionally and mentally draining. Add to that, there are financial issues involved. If you have just been through divorce procedures, what can you do to avoid the threat of bankruptcy?
Find a new home. Some couples may agree to sell their home and find separate properties. If you plan to purchase a new house, make sure that you do not make decisions in a hurry. Do extensive research and consider your repayment capabilities before applying for a loan. It is also wise to get a pre-approval so you can have a more realistic idea as to the price of home you can afford.
Be financially independent. If you have joint bank accounts or credit card extensions, it is best to have these separated. Thus, possible issues or problems on money matters can be avoided.
If you haven’t done so, open your own savings account right away. Be sure to save up for minor emergencies as well. Build your savings account fund which can last you for a least six months or longer just in case you need to take a leave from work or find a new job.
Create a new budget system. Budgeting your money will be different now that you and your spouse are separated. Study your monthly expenses and find practical ways to cut back on your costs. If you have unpaid debts with any creditor, debt repayment should be put on top of your priorities.
Get an insurance policy. Do you have a health insurance plan for you and your kids? Even if it means getting a second job, having an insurance coverage gives you financial protection during times of need.
Get help. Seek advice from an attorney regarding your rights and obligations, particularly with regards to giving financial support to your kids. A trusted credit counselor can also give you better strategies in managing debt and finances.