The Truth About Divorce and Bankruptcy

Everyone knows that most divorces take a large emotional toll. But what about a financial toll? Most people don’t realize this aspect until they experience it firsthand. Divorce can cost you thousands of dollars upfront and exact an even larger amount of money over the course of the next several years.

Unfortunately, newly single moms often take the largest financial hit in the aftermath of a divorce. The change in finances often leads single moms to file for bankruptcy a few years after divorce.

In our blog below, we’ll talk about why many single mothers have to file for bankruptcy. We’ll discuss the warning signs of an imminent bankruptcy, then talk about why filing for bankruptcy might help, rather than hurt, your financial future.

Why Does Divorce Drain Finances?

When it comes to divorce, both parties have to pay attorney and court fees, which can amount to thousands of dollars. In general, an uncontested divorce is much cheaper than a contested divorce. When both parties agree amicably about splitting assets, child custody, and child support, the divorce process is shorter, which means you pay fewer legal fees.

However, even an uncontested divorce can have a variety of costs. Apart from obvious legal costs, divorce has several hidden fees that can manifest immediately or over time. For instance, if your spouse gets your shared car when you divide your assets, you’ll likely have to invest in a car of your own. The costs multiply if you need to look for a new house or apartment.

Most importantly, instead of having two incomes, you’ll now be living off just one. Some married women stay at home until their divorce, so they might not have worked outside the house while raising their children. Although child support payments can help, single mothers (who usually end up with partial or full child custody) often have to find a job outside the home to support their children.

Some women struggle to find a job after staying at home for many years. If they don’t have recent job experience, some employers unfairly brush over single mothers. As a result, single moms might end up with lower-paying jobs.

If you’re a single mom, your ex-spouse might also fall behind on child support payments. You might have to incur additional legal fees if you have to resort to the courts to get the child support payments you’re entitled to.

All of these financial burdens add up over time and can lead many newly divorced parents, especially single mothers, to file for bankruptcy.

How Can You Avoid Bankruptcy?

In some cases, bankruptcy simply can’t be avoided. And if you’ve already reached the end of your financial rope, bankruptcy can give you a way to start over and create a better future for yourself and your children.

However, if you’re floundering but not quite to the point of bankruptcy, you have a few options to stay on your feet. Start planning for your financial future as soon as possible after your divorce with these steps:

  • Learn how to budget. If your ex-spouse took care of most of the finances, do your own research to learn how to manage your finances from here on out.
  • If you and your partner had a joint bank account, create a separate checking account as soon as possible. Cancel any shared credit cards and get your own individual card.
  • Scale back any non-essential purchases. Since you’ll live on a single income from now on, you’ll have to spend about half as much as you did before.
  • Avoid credit card debt. Try not to put more on your card than you can pay off by the end of the month. Credit card debt piles up quickly, and interest fees only compound the problem over time.
  • Learn about taxes. An attorney or financial advisor can help you understand which taxes you need to pay in the aftermath of a divorce.
  • Verify that all of your assets are in your name now.

These simple steps can help you keep your head above water after a divorce. Finances will likely be tight for a while as you and your children adjust to your new lifestyle, but if you save where you can, you’ll feel more secure in your finances after your divorce.

What If You Can’t Avoid Bankruptcy?

In spite of your best efforts, you might find yourself facing bankruptcy. You might need to file for bankruptcy if you:

  • Spend a lot of time worrying about creditors and debt
  • Have maxed out your credit cards
  • Have missed major payments on most of your bills or mortgage
  • Constantly receive phone calls from creditors

If you think you’re heading for bankruptcy, get in touch with a bankruptcy attorney at Wiesner & Frackowiak, LC. As stated above, bankruptcy can give you a fresh start and might be the best choice for you and your kids in the long run.


A divorce throws a wrench into your life plans, including your financial goals. However, with a little help from these tips and advice from a financial counselor, you can get back on your feet. To learn more about bankruptcy, visit our blog frequently, and get in touch with a bankruptcy attorney for more help.