As you move closer to the divorce process, it's imperative to better understand your finances and what will change in the weeks and months to come. The more time you put into this up front, the better off you'll be in the future.
While no two people are facing the exact same circumstances, there are some things you can do to prepare your finances for divorce. Here are five tips to guide you:
- Review your budget: You want to get a better feel for your income and expenses right now, as this will help you understand what's going to change after your marriage is in the past. You shouldn't expect your budget to remain the same, so now's the time to prepare for potential changes.
- Make note of future expenses: Even if your income will remain the same after your divorce, there's a chance that your expenses will change. For example, you may need to purchase or rent a new home. Or maybe you'll find yourself paying child support and/or alimony. Preparing for new expenses up front can help you avoid trouble.
- Gather the necessary documents: You'll need quite a bit of documentation to make it through the divorce process, including but not limited to: bank account statements, retirement account statements, loan statements, recent pay stubs, tax returns and a list of debts and assets.
- Prepare for everything: Even if your soon-to-be ex-spouse says they want to work things out, this is very rarely the case. You're sure to run into resistance along the way, so you must prepare for anything and everything that could come to light.
- Don't make big financial decisions: It's okay to do so after your divorce is finalized and you're financially stable, but don't do this while the process is unwinding. For instance, this is not a good time to purchase a new home or car.
By taking these steps you'll find it easier to prepare for divorce, which allows you to make better decisions now and in the future.
The divorce process is full of twists and turns, and any mistake can cause you trouble for years to come. When you know your legal rights and the steps to protect them, you'll have the confidence you need to proceed.