You and your spouse have tried all the marriage remedies, but they just aren’t working. Divorce is now your future, and it can be an expensive proposition.
All divorce proceedings have their highs and lows, but focusing on your financials should be a priority. Whether it be cars, a home, other property, elder care or other assets, separating a couple’s money can be messy. Being as organized as possible can only help your situation.
The five tips below will help you toward feeling a sense of financial readiness ahead of your divorce.
Record current expenses and predict future expenses
Once the divorce seems imminent, and if you don’t do so already, track all expenses (everyday housing, utilities, bills, travel, entertainment, child care and any other costs that pop into your head). To predict future expenses, consider the predictability of past expenses and account for the rare expense as well (like that family vacation to Disneyworld last year or having to replace another broken appliance).
Get your financial documents in order
Gather any financial document that has any relation to you. Refer to the comprehensive list below to get started. Also, information in shared accounts does not have to be kept confidential by your bank or other financial institutions.
- The Previous 12 months of account statements (checking account, savings account, investment accounts, credit cards, loan statements)
- Retirement account statements
- A few months worth of current pay stubs
- List of assets brought into and accumulated during your marriage
- List of debts brought into and accumulated during your marriage
- Income tax return documents of the past three years
For further answers of what records to prepare, consult with a family law attorney.
Ready yourself for future hazards
If you can divorce amicably, that’s fantastic, but many divorces are rocky and tense. The other spouse often is resistant, especially when it comes to handing over certain financial information.
Spend little and save
During the proceedings and for a few months after the divorce is finalized, you should put yourself on a strict budget. It’s essential to be financially conservative during a divorce because you don’t know what may pop up and, more importantly, how the funds will be divided in the end. If you and your future ex’s relationship is very tense, consider a legal separation throughout the proceedings. Doing so will allow a court to dictate how funds are to be allocated and used until you two are officially divorced.
Family law attorneys and certified divorce financial analysts and provide valuable insights into divorce negotiations and how your financial future will look during the divorce and into the future.