Financial Steps to Take When Considering Divorce
Divorce can be complicated and difficult for all involved. Among other things, when considering divorce, spouses may have many concerns about family and financial stability. Early action can help address these concerns. Consider taking the following steps to allay fears about your financial future as a newly single individual.
Ascertain Assets and Debts
When couples divorce, they divide not only their assets, but also their debts. Spouses considering divorce must ascertain their debts, such as mortgages, car loans and credit card debt. It is also important to identify joint assets and personal assets. Assets should be divided fairly in a divorce, and understanding what’s at stake can help ensure an equitable division. Finally, one should determine what it takes to run the household by keeping track of personal and family expenses.
Locate and Preserve Papers and Passwords
In addition, spouses considering a divorce should make copies of all important papers such as birth certificates, passports and insurance policies. After making copies, place them in a secure place. When couples share passwords for email, social media or bank accounts, change the passwords and create individual accounts. Privacy is very important during and after the divorce.
Understand Your Earning Capacity and Your Spouse’s
Understanding earning capacity can also help people set themselves up for financial success after divorce. In many cases, divorce is more difficult when one spouse does not currently work outside of the home and may have to find a job. Therefore, the individuals’ earning capacity and current employability are factors in determining any child support or spousal support. Spouses can look at old pay stubs, tax returns, bank statements or other documents to analyze this information.
If spouses have only joint bank accounts or credit cards, it is important to establish credit in one’s own name. Try not to make any major purchases until the divorce is finalized, as divorce can greatly change spouses’ lifestyles, and a judge may see large expenditures just before divorce as made in bad faith.
Consult an Attorney
The necessary legal steps in a divorce can be complicated, and an attorney can help those considering divorce identify their legal options, advocate for their interests and protect their financial wellbeing.