Making Sure You Are Prepared For Your Divorce
If you are preparing to go through a divorce, the process is never easy
. No matter how amicable you and your ex may be, it is still a difficult process financially and emotionally.
By preparing for a divorce before it actually happens, you can reduce much of the stress and conflict that many people face when they rush through the process. Planning ahead allows you to make sound decisions and start preparing for your life after divorce, as well as helping you to avoid some of pitfalls that can occur after the fact.
The amount of information required for a divorce can seem overwhelming, so it makes sense to begin gathering all of it together as soon as possible. You will need to have a record of names, account numbers, addresses, and phone numbers for all of your assets and debts.
This includes bank accounts, credit cards, loans, stocks and bonds, mortgages, and title information. It also helps to have tax statements for the last three years, as well as pay stubs and employment information.
If there is a business involved, get a copy of the tax records, assets, and debts. Other paperwork to make copies of are deeds, prenuptial agreements, wills, and powers of attorney.
Now you can then determine the net worth of the marital estate. The marital estate is everything that was acquired during your marriage.
Net worth is the total of all debts subtracted from the total value of the assets. This will give you an idea of what you will be entitled to after the paperwork goes through.
If you will be receiving an inheritance, do not put it in both of your names, and do not use it to buy marital property or pay marital expenses. This will help to keep your inheritance separate from the marital estate.
Another consideration is to keep a budget of your income and expenses. This will help provide documentation for determining the amount of support awarded, as well as give you an idea of what it will take to live.
For some people, it may make sense to hire a financial planner to help sort out all the financial information, and assist in making sound decisions. This painful process has a way of wrecking a person's credit.
While you are preparing for a divorce, you should get a copy of your credit score to see where you stand. If your credit is poor, you should start paying down your debt and cleaning up the bad marks on your credit file.
Doing so while you are married can help you qualify to buy a house or car after you divorce. If you don't currently have a credit record, apply for a credit card in your name only.
Establishing your credit while you're married is much easier than after the fact. It's important to not build any additional debt, as you will want to keep assets as liquid as possible.
Likewise, don't allow your spouse to take out more debt, or convince you to refinance the marital home before filing for divorce. This just further entangles the finances and leaves both parties with larger liabilities after divorce.
It is also a good idea to open a checking account in your own name to safeguard your finances. This will allow you to pay expenses without having to worry about your spouse finding out or taking the money.
You can use this account to build a reserve to cover emergency expenses, attorney fees, rent, deposits, utilities, etc. If you don't want your spouse to know about this account, have the statements sent to a PO box.
With alimony becoming more rare all the time, it's important to be sure that you can provide for yourself. If you are currently employed, don't quit your job.
If you aren't working right now, polish your resume and begin to think about what type of work you would like to do. You might also consider returning to school to get training, either to advance your career or enter the workforce.
You don't need to fall apart if this is the circumstance you are dealing with. Talk to a lawyer about what you should do now to prepare, and the process will go much easier for you.
by: Tom Selwick
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