Going through a divorce can put your finances in turmoil. Until your settlement and spousal support are worked out, you may find yourself responsible for expenses involving a new apartment, the kids’ school supplies, car payments and attorneys’ and other consultants’ fees. If you’ve been out of the workforce raising children, you may not have a job or at least not one that can support you.
Many people find that the easiest way to handle these new and often unexpected expenses is to put them on their credit cards and pay only the minimum amount due each month until things settle down. However, that can land you under a mountain of debt from which you may be unable to extract yourself. It can also destroy your credit rating at a time when you need to protect your credit score more than ever.
There are other solutions for getting needed money that make more financial sense that putting expenses on your credit card. There are various types of loans available. Peer-to-peer lending is becoming increasingly popular. Short-term loans can be used for large purchases such as furniture, appliances and medical bills. If you find yourself with credit card debt piling up, you may want to consider a consolidation loan.
Budgeting is crucial during and after a divorce. Until you know what your monthly income and expenses will be, cutting back on unnecessary expenditures is wise. You may benefit from seeking advice from a financial planner in addition to talking with your family law attorney about immediate financial issues that you may need your estranged spouse to help you deal with.
Source: Huffington Post, “Handling Credit Card Debt During and After Divorce,” Beth Cone Kramer, Aug. 14, 2015