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Credit card debt can complicate your divorce

Once you decide to divorce, there's a lot to think about in regard to dividing assets and debts. Neglecting to implement a plan up front can cost you time and money in the near future.

Naming responsibility for credit card debt is a common sticking point for many divorcing couples. Here are five tips that can help you better deal with this type of debt during divorce:

  1. Discuss paying off the debt before filing for divorce: If you and your-soon-to be ex-spouse agree that this is the best strategy, talk about the best ways of eliminating your joint credit card debt. The most common strategy is using money from a joint bank account to eliminate the debt once and for all.
  2. Use a balance transfer credit card: If you're unable to pay off the debt before your divorce, both individuals can use a balance transfer credit card. This ensures that you and your ex are left with the same amount of debt. You can then manage it however you best see fit.
  3. Cancel all joint credit cards: If you decide to fully pay off joint credit card debt, it's easy to overlook closing your accounts. If you leave one or more active accounts, it allows the other individual to continue using it.
  4. Track your expenses: Review the last three credit card statements and note which expenses are joint, which ones belong to you and which belong to your ex. This is particularly important if the other individual has run up a large amount of debt in the hope of only covering half of it in divorce.
  5. Consider filing for bankruptcy: Bankruptcy does not make sense for every divorcing couple, but it could help if you're facing financial difficulties. Chapter 7, for instance, allows you to eliminate some of your debts, including credit card balances.

The divorce process is complicated enough without credit card debt getting in the way. When you develop a plan early on, you're able to best deal with debt at the appropriate time.

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