Many Arkansas residents put a lot of thought into deciding whether to file for divorce but do not invest time in planning for the financial changes that often accompany the end of a marriage. A lot of the potential effects of divorce relate to financial matters, but adequate pre-divorce planning may help reduce the chances of lingering monetary problems.
A brief from Boston College’s Center for Retirement Research shows that divorce may have adverse financial effects for most individuals. The brief indicates that divorce is the outcome of approximately 40% of marriages. The immediate costs of divorce often include legal fees and new expenses that come with purchasing and maintaining two residences. Statistics show that people who have divorced may find it more challenging to have adequate retirement funds.
Forbes provides a list of several financial issues that individuals may want to think about during divorce preparations. For example, debt is a financial area that may become complicated after a divorce. Generally, only one person is accountable for credit card debt, even if income from both spouses contributed to payments during the marriage.
Mortgage debt may work differently. Even if only one person remains in the home and makes the mortgage payments after the divorce, the original terms of the loan may still apply in terms of liability. If a person cannot continue to make the mortgage payments, the lender may require his or her ex-spouse to take responsibility for the loan. Divorce may also affect each individual’s taxes and retirement savings. Taking the time before filing for a divorce to evaluate debts, assets, monthly expenses and income may help an individual maintain financial stability after his or her marriage ends.