Among the life events that lead people to file bankruptcy, divorce is at, or near, the top of the list. It’s hardly surprising. Suddenly a household income is halved, yet expenses remain the same, or even increase.
The Los Angeles Times has a great feature on how debt can overwhelm someone who finds herself going through a divorce. The subject of the story is given a “money makeover” with the help of some financial experts. While she’s given a plan that helps her pay all of her debts, the margin for any contingency is extremely thin. Even a small medical emergency could put the plan into the ditch.
I did like that the financial planner also recommended selling a house in which she had little equity. That may make the difference between success and failure. The story is a real life look at how drastically divorce can change a person’s financial outlook.
Read the story here.
