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Divorce can be trickly when credit cards are involved

The process of dissolving a marriage can take an emotional toll on a person in New Jersey, but it can also be a source of financial stress. This is especially true for couples who have a significant amount of credit card debt. A few tips may help those navigating a divorce proceeding that involves credit cards.

Although credit cards are certainly helpful for covering expenses in a pinch, they are more than simply vehicles for debt. Sometimes couples open credit cards so that they can earn points, get cash back or accumulate travel benefits. For many credit cards, it is not possible to immediately redeem the miles, cash or points. Rather, they accumulate over a period of time.

In a divorce case where a couple has millions of reward points or miles, a judge might have to determine how to divide the benefits. Certain programs do state, however, that their points or miles may not be transferred to someone else, even after the dissolution of a marriage. In such a case, the points or miles would simply go to the account holder. If a couple is disputing this, the court might rule that other of the couple's assets be distributed to the party who will not get the miles or points, thus balancing out the value.

The court might also have to determine the financial value of miles or points at issue, which can be tricky to do. Typically, the court will examine several factors such as the ticket time and destination. A working understanding of the law may help people to fight for their best interests when dealing with assets and credit card debt in a New Jersey divorce proceeding.

Source: The Christian Science Monitor, "Credit cards and divorce: What you should know", Robert Harrow, Dec. 6, 2016

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