Financial issues are a common cause of divorce. According to one survey, student loan debt can be a major contributing factor. About one-third of student loan debtors who participated in the survey said their divorce was caused by money problems, and more than 10% of those specifically blamed student loan debt. Some people in Arizona may be among those whose student loan debt is in excess of $50,000. The number of people who have passed this threshold is three times higher than it was 10 years ago.
The average student loan debt is also higher than it was a decade earlier. It has gone up more than 60% to $34,000. People with this kind of debt load may struggle to make financial commitments such as buying a home. However, it’s important for spouses to be honest with one another about their financial situations before heading into marriage.
One possible solution is creating a prenuptial agreement to outline how assets and debt will be dealt with in case of divorce. While couples may hesitate to do this, it is important to remember that marriage and divorce are both legal arrangements.
Arizona is a community property state, so if there is no prenup, marital assets and debts will be subject to equal division. The value of assets brought into the marriage may be calculated on their appreciation. Debts could pose a problem if the couple acquired them together but they are in one person’s name. Even if they agree to each pay off half the debt, creditors will consider the debt holder responsible. An attorney could help a client through the divorce process and fight for a fair division of property.