Divorce is emotionally traumatic and unfortunately, unless you and your soon-to-be ex prepare, it can also be financially devastating. Consider the advice below to protect your financial future if you are thinking of or are in the midst of dissolving your marriage.
Be prepared
Understanding the financial impact of divorce can save you time, money, and grief. Be proactive about learning how your finances will be affected.
Start saving
Hopefully, you have a strong saving habit already. But if not, now is the time to batten down your bank accounts and start saving as much money as you can to help offset expenses related to divorce. These expenses can include attorney fees, meals eaten out, and even the cost of running more than one household.
Create your own financial archive
Make copies and file all of your financial documents. If you feel that it is necessary, keep your archive off-site so you have access to accurate financial information independent of your former spouse. Engage a financial professional; having a CPA or other financial advisor on your side can help immensely. An accounting professional will provide an expert, objective view on how to manage your assets during the transition of your marriage.
Get a handle on your budget
If you don’t already have a budget to track purchases and bills, now is the time to do it. You should also consider which expenses are essential and which ones should be eliminated. This will help you understand how your income and expenses are flowing so that when your income is no longer joint, you know where you stand.
Take emotion out of the equation
Making rational decisions is crucial during this time, so try to think objectively and not emotionally as you navigate the division of your martial assets. Your legal and financial advisors should assist you in this regard.
Take your time
Depending on the nature of your relationship with your ex, it may be tempting to come to your divorce and financial arrangements as quickly as possible. Resist the temptation to rush because the decisions made now will impact your future financial security.
Divorce is not something that most couples anticipate, but having a handle on the financial implications is something you can control. Being prepared and taking the time to educate yourself and make rational decisions with the help of a trusted financial advisor is essential. Taking this approach can help you preserve your financial peace of mind now—and as you face the future as a single individual.
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