Financial Tips to Know

Divorce is like a natural calamity - sometimes you can predict it, sometimes it comes unexpectedly. In the United States, about 50% of marriages end in divorce. While this sounds disheartening, the good news is that you can prepare for one so that your road to splitsville does not end in financial hell. Here are some financial tips to help you survive a divorce:

Always be (financially) fit

Single or coupled, you have to be financially literate. It's the only way to survive in this world. Ideally, you should always be able to stand on your own. Know your spending habits and learn how to live within your means. In case you have not been vigilant with your finances thus far, start now, even though you think your relationship is in good shape.

Don't give up to easily

It's become a lot easier to divorce in the United States. It's true that some people should not be together, but most of the time, couples give up too easily. While the grass may be greener on the other side of the fence, they also have weeds there too. If money is the cause of your division, then ask for help from a counselor. Maybe there's hope for you yet.

Do not mingle the issues

But if divorce is the only way for you, then separate your emotions when tackling financial matters. It may be satisfying to exact revenge on your lying, cheating spouse, but you will probably just make your lawyers richer. Plus, if thoughts of causing bodily harm to your spouse consumes you, it will distract you from negotiating a fair arrangement.

Make a list of assets and liabilities

Gather all your financial information and study them. If you have a pre-nuptial agreement, read it and learn which assets belong to whom. Write down all your assets and liabilities. Try to be honest about it, but be mindful of any signs that your spouse is hiding assets from you. While its illegal, it does not stop scrupulous people from trying.

Assess your financial fitness

The list described above will help you determine the state of your financial health. Request for credit reports and keep a good eye on each and every entry. You want to start your new life in good shape. Talk to a finance counselor as to how to maintain or improve your credit standing once the divorce pushes through. Open accounts in your name. Don't forget to study your current insurance and make the necessary changes in your coverage. Review your retirement plan, too. At the end of this exercise, you should be ready for all the changes the divorce will bring.

Assemble your advisors

Choose your support group carefully. You may need a divorce lawyer, a tax specialist and a financial advisor during your divorce. Some may not need all of them, especially if there are not too many assets and liabilities. Some of them will have conflicts of interests, so be on the lookout. Your interests should come first before their fees.

Study your spending patterns

One of the advantages of living together is that you cut down on some expenses. Analyze the changes in your spending after the divorce so that you can adjust your budget accordingly.

Divorce is always painful. Some people are consumed with the pain of the change and get stuck in the past. But if you are prepared, you can treat a divorce as your new lease in life.

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