Bankruptcy and Divorce: The Twin Terrors.

In America, there seems to be an increasing trend of Bankruptcies and Divorces. These twin terrors cause depression, heart-ache, and broken families. Is there any reason why these issues are so closely linked and what can be done to solve the problem?

According to the United States Department of Justice, bankruptcy filings have grown overall from about 110,000 in 1960, to over 1.4 million in 2009. This is about 32% of Americans. The percentage of divorce has also increased in this country from around 30% of first marriages in the 1970s, to over 51% in the late 1990s (US Census Bureau, 2002) . Why are both divorces and bankruptcies over the last 40 years growing at such ridiculously high rates?

According to Elizabeth Warren, (2002) 91% of bankruptcy filers have suffered a job loss, medical event or divorce. It is clear that divorces can contribute to causes of bankruptcy. So the question is, “Can bankruptcy cause divorce?”
The answer to this question is answered by Rachel Foley, a Bankruptcy Attorney in Kansas City, Mo in her article Does Bankruptcy cause Divorce?.

Foley says a high percentage of her clients were coming back after the bankruptcy to file divorce and she wanted to analyze why. “At this point I get two phone calls. The first is that they want to get out of bankruptcy and the second is they want to file for divorce because they blame each other for the current situation” (Foley, 2008).

Since most financial issues in marriage are caused by lack of communication, it is no wonder that so many couples go into far too much debt than they can handle before they are forced to stop and talk about it. Imagine adding on top of normal financial stress the weight of the bankruptcy proceedings, and stir in bad communication and presto, all the makings of a messy divorce.

Of course, Bankruptcy and Divorce are not always the wrong answer and may sometimes be the only choice for some couples. However, when over 1/2 of all first marriages end in divorce and nearly a 1/3 of the population filed for Bankruptcy last year, something is not right. What is missing in both of these cases is commitment.

Marriages that have strong commitment levels have a higher likelihood of success. In fact, those marriages that have commitments beyond the grave have fewer divorce rates, some as low a LDS temple marriage of only 6% (Lobdell, 2000).
Marriages that also have commitment to financial responsibility learn to communicate about it and make smarter financial decisions to prevent Bankruptcy. Dave Ramsey, (2007) in his book The Total Money Makeover, explains that bankruptcy is not the solution and instead just a symptom of people who are not committed to living financial responsible lives. He says that after bankruptcy it is then easier to go file again and again. The same is true for divorces that once you divorce the first time, the chances for divorce increase with each next marriage.

Remember that once a couple does file for bankruptcy their chances of divorce increase and vices versa. Decide to commit today to being a better spouse and to get your financial situation in order. We need to wake up and save this country from the Twin Terrors that Bankruptcy and Divorce leave behind and create a better future for the America of tomorrow.

For more information visit the Thriving Marriage Institute at www.travisparry.com.

Reference

http://www.womansdivorce.com/divorce-and-bankruptcy.html

http://www.bankruptcylawnetwork.com/2008/02/03/does-bankruptcy-cause-divorce/http:

http://www.creditcards.com/credit-card-news/bankruptcy-filings-2009-1276.php

Ramsey, D., (2007). The Total Money Makeover: A Proven Plan for Financial Fitness. Thomas Nelson Inc. Nashville, TE.

Rose M. Kreider and Jason M. Fields, “Number, Timing, and Duration of
Marriages and Divorces: 1996″, U.S. Census Bureau Current Population Reports, February 2002, p. 18.

William Lobdell, Holy Matrimony: In an Era of Divorce Mormon Temple Weddings are Built to Last in Los Angeles Times, 8 April 2000;