The legal end of a marriage often comes with an array of financial hurdles. Initially, some may think that legal fees are what makes divorce so expensive. But there are far more elements at play. Preparing for the monetary strains of divorce starts with understanding where your money will be going.
A divorce may, for example, require you and your ex-spouse to take time off from work to take part in necessary proceedings, causing you to lose wages or paid time off hours. It is likely you will also seek new housing. You may have once split bills with your spouse or relied on them wholly for the finances. But now you will be taking on financial demands on your own.
To avoid significant harm to your bank account, consider doing the following:
- Create a budget: Consider the expenses you are likely to have once your divorce is finalized. What expenses do you expect to have in six months? A year? Where are your investments and can you make adjustments?
- Try to negotiate: Negotiating with your spouse, provided you can come to agreements without hostility, may save you time. And in saving time, you will likely save money. Additionally, when you negotiate issues like property division and child custody, you come to the divorce table with more control over the fate of your assets. Whereas the court will decide what is best should your divorce go to trial.
- Face your debts: Courts split marital debts between divorcing spouses, but creditors still consider the debt a shared responsibility. Try working with your ex-spouse to tackle as much debt as possible, so you do not have to deal with it in the long-term.
- Revise vital documents: Update all trusts, wills, life insurance policies and other necessary documents to avoid losing money to your ex-spouse who may still be named on them despite the end of your marriage.
Rarely are there easy steps in a divorce. But taking measures to control of your finances before they control you can do wonders for your long-term plans.