how to divide credit card debt in divorce

When a marriage comes to an end it is always a tragedy. Of course the rending of the family and difficulty for the kids is the hardest thing about separation at divorce. But the difficulty of separating one's house into two can be difficult and tedious to say the least. You have to go from one checking account to two, two homes instead of one and separate accounts for everything from credit cards to utilities.

The is additional overhead in handling divorce situations. In addition to splitting your assets, credit card debt that was part of the financial picture must also be split. Too the credit card company, the family credit card is property of the shared entity which was the marriage. So, when the marriage ends, from a financial point of view, the separation of your accounts is not over.


So, one of the many issues that need to be discussed and planned for is how to separate the credit card debt. Whoever continues to hold the family card accounts will continue to get the bills and will be expected to pay them. Now, the least preferable way to handle this debt is to build the payments into any forced settlement agreement such as child support. So at the time the divorce is final, the debt and the payments to be made probably should be calculated and half put into the amount that the income generating partner must provide.

But that leaves the management of those credit card debts for one partner, and the other partner only has to pay a set amount. And if the credit cards get used by either partner, that legal amount would have to constantly change, which would prove to be a constant headache to administer.


Since the divorce is shared responsibility, each spouse can work with the other to adjust the financial picture in an advantageous way. How to separate the credit card debt should be part of the planning. Part of that planning is how to use shared assets to pay down the debt. You may have a home or homes that will be sold, retirement accounts or other assets that were set aside for the future of the marriage. Before they are split, close those accounts and distribute the funds using those assets to retire the shared debt.

But it’s likely some of that debt load will live on past the divorce. In these cases splitting the debt into two individual accounts may be the way to go. If the family was carrying $10,000 in debt, each marriage partner walks away with $5000 of the debt which is fair and equitable. How each individual handles that debt is up to them.


There are two ways you can go about splitting the credit card debt. If the debt is with a carrier with whom you can negotiate, setting up a meeting or having a conference call with the managers would be productive. The credit card company would rather negotiate with you on how to handle the debt load, rather than deal with the possible repercussions after the divorce. So, they may be willing to set up separate individual accounts and split the debt for you.


But you can always use the method many of us have used to manage credit card debt. Both parties can set up new separate credit card accounts. You no doubt have dozens of credit card offers coming in that you can use to start this process. Research which provide the best rates and policies for you. Part of the offers for these accounts are balance transfers. If you take out individual accounts and use the balance transfers to move each partners shared part of the debt to those accounts, that would be a clean way to split the debt.

There may be adjustments made to the 50-50 split concept based on who is the primary bread winner and also who ran up the debt. But by negotiating the terms of how you are going to split the credit card debt when you separate will be one more example that you are handling this in a mature and responsible manner.



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