Our Lawyers in Woodstock IL Discuss the Needs Hierarchy

rings gavel Lawyers in Woodstock ILConsider contacting lawyers in Woodstock IL if you are currently in need of clarification during financial distress. When dealing with divorce or bankruptcy, it is essential to establish a needs hierarchy. The needs hierarchy is used to determine which expenses get paid and is ranked in order of people, possessions and credit rating.

Needs Hierarchy

The first priority is the physical, emotional, medical and mental well-being of all involved parties, including the children. This includes food, shelter and clothing. These three priorities come before all else, including the protection of possessions. This means that they come before payments on the home mortgage as well as car payments and other forms of debt. Unsecured creditors are the lowest on the needs hierarchy, and this category typically includes credit cards.

Practical Applications

It is often difficult to put the needs hierarchy into action when it comes to real world situations. Those who are used to paying debts on time or having extra money set aside in case of an emergency generally have a hard time adopting a survivor mentality when going through a financially strenuous divorce. The divorce process can seem illogical, leading to the use of credit when it would usually be avoided. The definition between the levels of the hierarchy are not always clear. For example, having a lack of income makes it difficult for a parent to care properly for his or her children. If you are forced to make the minimum payment on your credit cards to provide for your children’s needs, the lines between your credit rating and the needs of the people involved may become blurred. Nonetheless, the hierarchy is incredibly useful to keep in mind throughout the divorce process. The primary idea behind the needs hierarchy is not to follow each tier to the letter but to keep in mind that the needs of people come first. Assets and credit ratings can be rebuilt once the divorce is finalized, but it is important to ensure that everyone who is affected by the divorce is properly cared for, even if it means following counterintuitive financial behaviors. Our lawyers in Woodstock IL may be able to provide guidance when it comes to implementing the needs hierarchy.

Contact the Lawyers in Woodstock IL

Call the Stetler Law Group today at (815) 529-4554 to speak with experienced lawyers in Woodstock IL.