Divorce gives you plenty to think about, and a lot of it is financial. How can you protect your wealth? What will you have left after the split? What is your ex going to get? What are the tax implications? The questions go on and on.
It's stressful. You already have enough to think about with the end of a romantic relationship and potentially changing roles with your kids. You have to put these things first. Don't let the financial side of the divorce feel overwhelming.
To that end, here are some critical tips that can help:
- Be careful about who you let give you advice. It can come from all over: family members, co-workers, friends. People will all have ideas about what you should do with your money or what rights you have. Don't take this advice. Don't make serious mistakes based on what someone told you when they were not an expert.
- Remember the more complicated financial questions. It may not be all that difficult to look at things like dividing cash or your bank account, but don't forget that you need to divide things like retirement plans, investments and even joint debt.
- Split up the money you use on a daily basis. Having a joint account worked before, but one of the first steps you should take is for you and your spouse to get your own accounts. Route your individual paychecks to those accounts. Put some separation in your finances.
- At the same time, ditch your credit cards, if they're also joint cards -- something many couples use. Don't let your soon-to-be ex rack up debt on an account with your name on it. Close the joint accounts, and you can both go out and get personal cards instead.
- Start paying closer attention to what happens to your money during the divorce process. It can take weeks. Pay attention to separate earnings and spending habits; you're not divorced yet, but that doesn't mean you should start putting your assets and debts into separate categories.
- Plan for the future. Think about potential alimony payments, child support payments and much more. Your financial future is not just defined by how you split up what you both own now. It is defined in part by how your finances may stay mixed for years or even decades to come. Consider how that is going to look and make a plan that accounts for it.
These tips can help you get started, but they are not all that you need to know during a divorce. You have to be careful with financial decisions. Make sure you know exactly where you stand and what options you have as the process plays out.