There’s a lot to think about as you prepare for divorce, with your financial situation among the most important details.
When you prepare your finances for the divorce process, you’ll feel better about the way things will unfold.
Conversely, if you don’t take a second look at your finances pre-divorce, you could run into one challenge after the next.
Here are five of the best ways to prepare your finances for the divorce process:
- Collect the necessary documentation: This can include but is not limited to bank statements, retirement account statements, loan statements, credit card statements recent pay stubs and recent tax returns. Keep in mind that these documents can change over the course of your divorce, so update them accordingly.
- Review your budget: Your budget isn’t likely to remain the same post-divorce, so it’s important to review it in great detail. This is also a good time to make note of any expenses that you want to reduce or eliminate in the future.
- Uncover hidden assets: You hope it doesn’t come to this, but your soon-to-be ex-spouse may attempt to hide assets from you. If you’re aware of this, make sure you bring it to light as soon as possible.
- Don’t make any big financial decisions: You’ll have time after your divorce to purchase a new car or home. Big financial decisions before the divorce process may complicate things, especially if the other individual argues that you used joint funds to make the purchase.
- Get help: You may not have a spouse to lean on, but there are others who can help you prepare your finances for divorce. For example, talk to your tax professional about what you should and shouldn’t do. Also, meet with a financial advisor who can help you adjust your approach to spending and saving.
When you take these steps early on, you’re able to turn your attention to other areas of the divorce process, such as child custody, child support, spousal support and property division.
Divorce will impact your finances in many ways, but when you prepare accordingly you’re able to protect your legal rights and put yourself on solid ground as you move forward with your life.