The “Needs Hierarchy”

The Needs Hierarchy During DivorceA “needs hierarchy” establishes the order in which expenses are to be met, especially if a divorcing couple is in difficult financial straits.

People Come First
When setting up the “needs hierarchy,” the structure of it will be set in order of importance. People come first, then possessions, and finally the credit rating.

Survival and Well-Being
Your attorney will advise you to place the best interests, the health, mental, emotional, educational, and survival needs of both spouses and children before any other considerations. The basic necessities of everyday living (food, shelter, clothing) must take priority over all else.

Possessions
Once the basic necessities and the general well-being of all concerned have been attended to, you and your attorney can attend to protecting your possessions such as the home, cars and other such expenses. After that, such unsecured debts as credit card payments can be addressed.

Working with the Hierarchy
Maintaining control over and working within this hierarchy in today’s world is no easy matter. Divorce and the stresses that come with it can wreak havoc on the lives of people who are used to keeping their bills up to date and to having money put back for sudden unexpected expenses or emergencies. 

Blurring of the Categories
Divorcing couples must often deal with emotional issues that can interfere with budget management, and the divisions between the three aspects of the hierarchy can often become difficult to separate. Unexpected expenses can cause additional credit card debt, especially when it becomes necessary to charge foodstuffs rather than paying by check because money has become tight. When lack of funds forces an individual to suspend vehicle payments and the car is repossessed, the individual then has no means of going to work.

The loss of a car can also become a threat, as the welfare of the family is jeopardized if the working spouse loses his or her job due to lack of transportation. Further, during a divorce it becomes extremely easy to find oneself dependent on credit cards. In order to obtain additional money, make purchases and use the card’s services, it is only necessary to pay the very minimum. 

Flexibility in Application of the Hierarchy
Given the difficulties that can arise and the interactions between one’s possessions and the welfare of the family, it is not always feasible to adhere to the letter of the hierarchy. The simple fact is that possessions can be repurchased, credit ratings restored or repaired, but the people in your life are your first priority and their welfare must always be the overriding consideration.