Tips to Financially Plan for Divorce
Divorce is a tough process emotionally, as well as financially. Untangling two people’s money is a difficult and messy task. In divorce situations, either the divorcee or the divorced might need to pay child support. Each divorce has a complicated situation. This is the reason a person may need to take advice from the experts. Consulting an expert will help to tackle those difficult problems which the divorcee or divorce might not be able to handle. Here are some tips to help you financially plan for divorce-
1. Take Advice from Financial Advisors
In such difficult times, you should be alert about false statements. Divorce laws vary by state so you need to be cautious about pieces of advice that fall in your path. (Such advice might be from your friend or a close relative) If you are unsure whether you should move your money, change accounts, or make other financial moves, then you should contact your financial advisor. However, this should be done pre-divorce. You can also consult a divorce attorney in your area.
2. Track Expenses – Anticipate Future Ones
Tracking your income & expenses after knowing that your divorce is inevitable will help you to plan your divorce. This will help build a budget for your divorce. It will also make it convenient for the judge to split your assets according to the divorce agreement. Look beyond your monthly expenses and think about future goals. Include things like holiday trips, vacations, and include one-time expenses. You may also use the previous year’s expenses as a reference, but always remember that circumstances may change.
3. Gather Documentation
Your financial records define the story of your marriage. You may find gathering documentation tedious, but it is the foremost need. Therefore, you should start gathering documents as early as possible.
You may start gathering the following documents:
- Savings account details (especially for the past year)
- Track Investments details
- Credit card statements (past year)
- Details of assets
- Ledgers for any loan, mortgage payments, etc.
- Income tax returns (past three years)
4. Prepare for Resistance
Resistance depends on the type of divorce. In an amicable divorce, the free exchange of information takes place. However, in the case of adversarial situations, the spouse may not release the legal documents unless forced to do. If relationship isn’t cordial, anticipate rough patches.
5. Be Conservative while Spending and Saving
You must continue to use your accounts, either individual or joint. If you do not have money set aside for hiring a divorce attorney, try to agree with your spouse about spending & conservative amount.
6. Know When to Get Help
Engaging a lawyer should not be considered as a matter of frustration. In addition to an attorney, a financial analyst can provide direction on the impact of divorce.
Conclusion
Financially planning for divorce will help in surviving tough situations. You may plan your expenses as per your income. It will help you in the proper division of assets, as well as offer you adequate solutions.
