Financial difficulties can make the divorce process much more stressful than it needs to be. If you and your spouse have decided to call it quits, preparation is the key to maintaining financial stability and being able to support yourself once you are legally single.
Knowledge is power
It can be easy to lose track of all your assets and debts as the years go by. Experts suggest gathering up all financial documents so that you have a complete picture of what you possess. These documents should cover:
- Retirement savings
- Credit card debt
- Wills and trusts
- Bank accounts
- Loan information
- Pension plan
Protect your finances
Once you have gathered your financial documents, it is time to start preserving your assets. While it may seem tempting to hide money from your soon-to-be ex, it is important that you do everything in the open, so the judge sees you as credible and trustworthy. Some steps you may take include:
- Getting separate checking and savings accounts
- Creating an emergency fund that you can immediately access if you need to
- Updating beneficiaries and making sure you have life insurance
- Splitting up assets, keeping in mind that some assets are tax-free
- Have your attorney file the proper documents with the courts (e.g. QDROs for retirement or pension plans)
- Have your attorney freeze accounts if you are worried your spouse may drain them
If your spouse has already drained a joint account or used marital funds for other purposes, your attorney may be able to get you that money back in the settlement, if they can prove your spouse’s actions were due to the impending divorce.
By taking the steps listed above, and consulting with a family law attorney in your area, you can avoid financial challenges as you go through the divorce process and once the divorce is finalized.
