Divorce is common in our society. Some couples find their way to reconcile through therapy while others are ready to move on. Whether married for two years or 30 years, divorce can happen.
Some couples have many assets and large sums of money to divide, others have a very modest amount. Nevertheless, when it comes to divorce, financial situations are often sticky. Having your finances in order can make this headache of an event a little less stressful.
Below are a few tips to put your affairs in order before a divorce.
- Look out for know-it-all’s
If somebody has experienced a similar situation, they have an opinion on how they would handle it. This includes how YOU should handle YOUR money throughout a divorce. Your friend or relative may have given you great advice before, but when it comes to a legal matter, it would be wise to contact a licensed attorney with expert knowledge to advise you.
- Develop a current and future budget – and stick to it
Nobody’s financial situation is the same, which is why it’s so important to track current expenses and predict ones that could occur in the future, like college tuition or needing to replace a broken appliance. Also, the most important reason to develop a budget if you haven’t yet, is that judges use this as a determining factor when deciding how to divide assets and debts in a divorce.
- Gather important documents
If you have ever done taxes, you know gathering financial documents can be painful, but the following documents are vital to telling the marriage’s true financial story:
- Past year checking and savings account statements
- Current retirement account statements
- Past year investment account statements
- Records of any loans within the past year
- Past year credit card statements
- Most recent pay stubs
- Up to date list of assets (those brought into marriage and those gained during marriage)
- Past three years income tax returns
- Get ready for pushback
Your spouse is likely to oppose your side of the story if the relationship is very frayed upon divorce. In peaceful divorces, couples are often wiling to exchange their information. If you receive continual confrontation and pushback from your spouse, speak with your attorney about court-ordered options.
- Be conservative with your spending
Due to legal fees, divorce itself is often a big expense. A typical divorce can cost upwards of $15,000. You may be tempted to make some big financial decisions prior to your divorce but hold off because your divorce could drastically shape your financial future.
There are many steps throughout the process of a divorce. Your financial preparation is one of the most important. Give your financial worries a rest and gain a step in the divorce process by adhering to the tips above.