When you think about it, the fact that bankruptcy is much more common among divorcees is not surprising. The additional cost of living separately and paying off marital debt may be compounded by job loss or underemployment. What’s changed recently in these situations is the length of time it takes to get back on one’s feet after a financial hardship. A sluggish job market and stagnant earnings potential have caused many divorced individuals to move in with aging parents or look for an additional source of income. The trouble is, it is often money problems that cause marital discord in the first place, and many couples think they will be better off after the marriage ends. In reality, many find they were far better off before the marriage dissolved.
In most divorce situations, Colorado Springs divorce attorneys find that the parties blame one another for their financial problems. Unfortunately, this leads to an endless cycle of finger-pointing and bitterness in their post divorce life. If there are minor children involved, continued discord between the parents just adds to their stress.
When couples meet with a Colorado Springs law firm, they often believe that a divorce will simplify their financial decisions, but unfortunately it is impossible to divorce oneself from marital debt. Divorce may actually make things worse because each party will have higher living expenses, less free time, and a hefty share of the marital debt load.
As a Colorado Springs divorce attorney may advise you, it usually makes sense to file for bankruptcy as a couple before filing for divorce. The main reason for this is that creditors will not be bound by the terms of your property division agreements, so if one of you files for bankruptcy after the divorce, creditors will usually look to the other one to satisfy their debts. The only way to prevent this is by maintaining separate accounts with all creditors throughout the marriage, but few couples can manage to do that.
Filing for bankruptcy before a divorce may not be an easy alternative, and will come with its own set of complications. However, doing so will require you to work together and cooperate, which might be impossible after your marriage is over. If you are concerned about how your current financial situation could survive a divorce, or how bankruptcy could affect your property settlement, a Colorado Springs divorce attorney can help.