Fifty-nine
percent of divorcees surveyed say that finances played at least
“somewhat” of a role in their divorces (20 percent believe it played a
“big” role). Also, 36 percent say their spouse’s credit score
was a source of stress in the marriage. Those surveyed regret not
learning more about their future spouse’s financial habits, prior to
walking down the aisle. A majority of both women and men — 71 percent
and 60 percent, respectively —said their former spouse’s spending habits
were different than what they anticipated before they married.
“It’s
important for couples to discuss finances before saying ‘I do,’ and to
communicate frequently. Couples should also make sure they agree when it
comes to financial practices such as budgeting and how to utilize
credit throughout the marriage,” says Rod Griffin, director of Public
Education. “Individually, each partner should make sure to be engaged
with the household finances so they can protect themselves and their
assets if the relationship ends.”
Couples’
finances are often negatively impacted by divorce, with the average
financial loss reaching nearly $20,000 (in cash and assets).
Furthermore, 44 percent of survey respondents say their former spouse
ruined their credit. As a result, for many respondents (39 percent), the
financial loss of a divorce has them going so far as to say they’ll
never marry again. Those that may consider tying the knot again at a
later date say good credit is an important quality for a potential
spouse (73 percent).
Tips for managing the financial fallout post-divorce
Emma Johnson from Wealthy Single Mommy:
“Separate
your finances from your soon-to-be ex-spouse ASAP. This is a time when
you need more credit than ever, to rent or buy a new home, get a new
car, set up utilities, and finance divorce lawyers. Identity theft is
incredibly common during a breakup, as is plummeting credit scores due
to confusion and conflict over who is responsible for which accounts.
Protect yourself - it is very common for divorcing partners to rack up
debt on accounts with both parties names attached.”
Diana Shepherd from Divorce Magazine:
“Creating a budget will eliminate the guesswork about what you can and can’t afford both during and after your divorce.
You need to determine what your current living expenses are and how
you’ll pay for them; potential sources of income include your own
earnings and spousal and/or child support. In addition to regular living
expenses, you need to budget for professional help from a divorce
lawyer, mediator, financial professional, etc. If your income from all
sources won’t be enough to cover your living expenses and
divorce-related costs, you need to take a hard look at your expenses and
see where you can trim them.”
Mandy Walker from Since My Divorce:
“Get
your credit report. This is the best way of knowing what credit
accounts are open in your name and whether they are held by just
yourself or jointly with another person. Use the report to help you
complete the financial disclosures required as part of the legal
process. It’s critical that these disclosures be as accurate as
possible. You can also use the report to guide you through discussions
with your soon to be ex about how any debit balances will be handled and
whether the account will be closed or kept open.”
Before
finding the perfect mate, make sure as an individual you have a good
relationship with your finances. Take our interactive quiz to find out
if you and your money are in wedded bliss or headed towards financial
frustration.
For more information on budgeting, as well as how debt can affect credit scores, visit the Experian Credit Education blog. Consider enrolling in a credit monitoring service such as Experian CreditWorksSM, which can help you better track and manage your credit report and credit score.
About the survey
The
online survey was conducted by Edelman Intelligence on Experian’s
behalf from Nov. 2 to 15, 2016, among 500 adults who have gotten
divorced within the past five years, are 18 years of age or older, and
reside in the United States. This online survey is not based on a
probability sample; therefore, no estimate of theoretical sampling error
can be calculated. For complete survey methodology, including weighting
variables, please contact ann@pitchpublicrelations.com.
About Experian
Experian
is the world’s leading global information services company. During
life’s big moments — from buying a home or a car to sending a child to
college to growing a business by connecting with new customers — we
empower consumers and our clients to manage their data with confidence.
We help individuals to take financial control and access financial
services, businesses to make smarter decisions and thrive, lenders to
lend more responsibly, and organizations to prevent identity fraud and
crime.
We
have 17,000 people operating across 37 countries, and every day we’re
investing in new technologies, talented people and innovation to help
all our clients maximize every opportunity. Experian plc is listed on
the London Stock Exchange (EXPN) and is a constituent of the FTSE 100
Index. Learn more at http://www.experianplc.com or visit our global content hub at https://www.experian.com/blogs/news for the latest news and insights from the company.
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