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Divorcees Reliant On Loans To Make Ends Meet

Getting divorced can be a stressful enough situation, but the problems don’t end once the marriage does. For many divorcees this is just the start of many problems to come, in particular financial problems.

Couples that get divorced find themselves losing out an their partner’s income, which means that they often have far less money coming in. On top of this, they still have bills, rent or mortgage, and other expenses to deal with. In fact, many divorcees have additional expenses to cover, such as the cost of finding somewhere to live, furnishing their new home, and dealing with increased debt.

A study that was recently carried out by the Alliance & Leicester showed that the level of debt amongst divorcees was significantly higher than that amongst single people and married couples, with many divorcees relying on loans as well as other forms of credit, such as credit cards and overdrafts, to enable them to keep their heads above water financially. This then adds to the problems, because more of their income has to go towards paying off debt.

Figures from the Alliance & Leicester report showed that around 28% of the annual income of the average divorcee went on repayment of debts, and this was compared to 16% of the total annual income of the average married couple. This is thought to be the result of a combination of a lower income and a higher level of debt amongst divorcees compared to married couples and single people.

Officials from the Alliance & Leicester also added that the need for divorcees to take out more personal loans and other forms of credit was partially due to the expenses involved in setting up along following the split.

Alisdair Milton
10th November 2006


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