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Divorce Preparation: Step 9 - Avoid additional debt or major purchases

By Jennifer Rice, Esq.

Here is the ninth post in a series about preparing for divorce. Divorce attorney Michael Sherman of the Alabama Family Law Blog has tips on divorce. I've added my comments in italics .

We continue our series on practical steps to take when you are about to face divorce. We are now to step 9 which is simple, but important:

Avoid additional debt or major purchases

This suggestion goes hand in hand with assessing how to handle the credit accounts, but deserves its own separate mention. If a divorce is going to happen, you want to be conservative with the finances. It is not time to be putting in a pool, buying a new car, or buying new furniture on credit. You want to simplify the financial situation not make it more complex.

When the divorce occurs, one of the primary things that has to happen is for the divorce court to allocate who will be responsible for what debts. Generally speaking, the less complex the debt situation, the easier task that will be. Especially with joint credit, the Court's decisions do not affect the creditor's relationship (credit card company, etc) with the debtors (you). The agreement/application that you signed is a separate contract. So even if the Court "awards" certain marital debt to one party, the creditor does not have to remove the other party's name from the account.

I should note again, all of this is general information. Your own specific situation may cause you to need to vary from it. For example, there are times when you may have to get an automobile and it would be better to do it before the divorce because you won't have sufficient credit on your own after the divorce. You may need to incur debt for reasonable and necessary living expenses. Be careful about running up lots of unnecessary debt. Not only with that make your situation more difficult, the Court may not look kindly upon an effort to bleed a company or the family dry.

So, obviously you will want to get specific advice from your own lawyer - which is why Step 1 was find a wise guide (an experienced, competent divorce law specialist)!

Full post as published by Colorado Family Law Blog on September 20, 2007 (boomark / email).