Control Your Finances During Your Divorce

divorce finances

Divorce is a difficult time, but you can't let your emotions take control when it comes to your finances. Chances are, throughout your marriage, you and your spouse fell into a comfortable division of responsibilities, so comfortable you may have stopped keeping up with whatever the other was doing with the money. Finances are often one of those areas. Now you must reacquaint yourself with everything from monthly bills to filing yearly income taxes. Most importantly, throughout your divorce proceedings, you have to make financial security your goal. Here are some suggestions to help you do that.

To begin with, when you feel panicked, your first thought might be to turn to your family and friends for advice. This is not a good idea. Yes, they do want to help you, but they don't know your entire financial picture. Your best bet would be to hire an attorney. An attorney knows what state laws apply to your situation, something your friends and family don't. He or she will examine your assets, compare your monthly income with how much you spend, and establish a working budget. If your marital estate is particularly complex, your attorney can recommend a financial lawyer. Go to your friends for a shoulder to cry on. Go to your attorney for reliable financial advice.

Next, start documenting everything, no matter how insignificant it may seem. Make notes about unpaid bills, bank account and credit card activity, even money spent on the children, if you have any. Did your spouse pay for a meal for the children at a fast food restaurant? Pay the dues for an after school activity? Buy school supplies? Pay for doctors visits? Even if it sounds petty, your attorney will need every bit of information in order to protect you and your interests, so document everything!

Now it's time to face some hard facts. Although many people try to make “maintaining the standard of living” a part of spousal support, it usually doesn't work that way. As much as you want things to go back to the way they were, the truth is, they won't. If you are lucky enough to be awarded spousal support, you'll still be facing a reduction of monthly income, and if you have children, your expenses will go up. Most often you'll be helping to maintain them in two households, making sure they have clothes, toys, and other necessities in two places. It's time to give up your dream of maintaining your old lifestyle and concentrate on financial security.

A good place to start would be the most difficult decision you'll make. Should I keep the house? The house has been a safe space for you, and naturally you don't want to let it go. However, this is the time to keep a level head. Make a post-divorce budget by making a list of household expenses, such as mortgage payments, property taxes, homeowner's insurance, utilities, and maintenance, inside and out. Will you be able to make these payments on one salary comfortably?

However, before you make this decision, you will have to divide the marital property according to the laws in your state. This is where you really have to keep track of your goal of financial security in mind. Many people approach negotiations as a time to get “what they are entitled to” without giving any thought to the big picture. Before you meet with your spouse, prepare a list of marital income, debts, and assets. Having that on paper in front of you will help you both make agreements that could be difficult to back out of later. Constantly remind yourself you aren't there to win. You are there for financial security for yourself and your family. The courts call it a just and right division or a fair and equitable division.

To this point, you may need to settle on some things. That doesn't mean you have to roll over every time your spouse counters a proposal with something you don't think is fair. However, stay calm and think about the outcomes of some things. Talk to your attorney and make your counteroffer.

Will you have to go before a judge if you don't accept this proposal? How much will that cost? Is it worth it in the long run? Is it worth the emotional toll and the financial expense? Don't do anything out of revenge. Remember your goal.

Keeping a level head during this emotional time may be difficult and beginning a new life may be challenging, but it will be easier without undue financial burdens and maybe even a little money in the bank.

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