Avoiding Bankruptcy After A Divorce
Divorce is a major financial challenge for any individual, regardless of their situation. In some cases, however, it can leave a person financially ruined- it’s not uncommon to hear of divorcées having to file for bankruptcy in an attempt to start over and recoup their losses. While your lawyer or financial advisor should be able to provide you with information that will guide your financial choices moving forward, know that if you do not want to file for bankruptcy, you may not have to. Below are some tips that you can use to avoid filing for bankruptcy as a result of getting a divorce:
Create a Financial Plan
Take an audit of your finances at present and determine what assets and expenses you have on your own. From there, work to put together a budget and make an effort to control your expenses moving forward. Once you have your plan and budget set, use them to determine the amount of money you need from your settlement to stay on solid ground. Consult with your lawyer, and if possible your Divorce Accountant, to present to them this figure and determine the feasibility of achieving this goal.
If you cannot reconcile your desired financial outcome, speak to your accountant or advisor about the best way to proceed financially. They will be able to guide you on the best path to achieving your financial independence.
Explore Collaborative Divorce
Collaborative Divorce proceedings save both parties time and money, as well as unnecessary stress. Should you and your ex-spouse be open to exploring the options of collaborative divorce, you can come to the table prepared with all of the financial documentation that justifies your spousal support request, and negotiate from there to find the best solution for you both.
Overall, it is important to keep the communication lines open and as friendly as possible in the divorce process. In some cases you may be able to receive temporary support to help with your finances until you get back on your feet again.
This blog is not official financial advice, which varies based off your unique situation. For a free 30 minute consultation with our Certified Divorce Financial Analyst (CDFA), Karen Stampone, please contact us online, or call 215-277-1191.