A divorce is challenging for many, as there are numerous financial implications. From determining alimony payments to how you will divide your property, you’ll need to make many considerations. One thing many forget to consider is how joint credit cards will impact your divorce. This often confuses spouses and can lead to contention. When you and your spouse decide to separate, you must enlist the help of Hudson County divorce attorneys. Keep reading to learn more about how to handle joint accounts.
What Happens to Joint Debt?
When you and your spouse divorce in New Jersey, any assets acquired during your marriage are subject to equitable distribution. Equitable distribution splits assets between spouses based on their contribution to the marriage, both financially and functionally. This includes property, bank accounts, and retirement plans. However, any debts accrued throughout the union are also subjected to equitable distribution.
As such, you’ll discover that any joint credit card debt you and your spouse have accrued over the course of your marriage can be split between you. An attorney will be able to help negotiate how much of the debt you are responsible for. Similarly, they can create an agreement that dictates how much each spouse will pay toward the debt and which party will be responsible for making the monthly payments. Having a written agreement is vital as if your spouse does not cooperate, a court can enforce the terms of the contract.
If you and your spouse cannot agree on a payment, the courts will create a plan. Again, they will assign debt based on which party accrued most of the charges. If your spouse was spending money on gambling or luxury items, they will likely not hold you responsible for that portion of the debt.
Should I Keep Joint Credit Cards Open?
Whether or not you keep a joint credit card account open depends on many circumstances.
Some may find that their spouse will rack up credit card debt as an act of revenge following a divorce. As such, you may be responsible for the debt you did not create. However, you may also find that in certain cases, such as a joint credit card for childcare-related purchases may be an easy way to manage payments.
If you wish to close the account, you’ll need to follow the instructions provided by your credit card provider. Some may allow you to simply remove your ex-spouse as an authorized user, while others require users to create a new account.
Divorce is a complex and challenging legal process. As such, it is essential to enlist the guidance of an experienced attorney to help you. At Greenberg & Walden, our dedicated legal team can help you through this process to protect your best interests. Contact us today to learn more about how we can assist you.