May 26, 2022
With divorce comes many challenges. You’re essentially uprooting your routine and way of life, while facing an uncertain future. Even if you know divorce is the best option for you emotionally, the process and aftermath can still take its toll on you.
One aspect of your life that you should be closely monitoring during and after your divorce is your finances. While many parts of your life will change as you go through a divorce, your finances are undoubtedly one of the most important. Going from a dual-income to single-income way of life will take some adjustments, but you can do it by following some simple tips to monitor your finances during and after divorce.
Divorce can get expensive, so it’s important for you to be as prepared as possible heading into this new chapter of your life. Making a budget can help you stay on track and rebalance your finances. This is especially helpful when going through a divorce for many reasons. With the average cost of a mediated divorce being $10,600 (including attorney’s fees), having a budget can help you factor this additional expense in without too much worry.
The budgeting process will also help you realize what your priorities are as you head into your new post-divorce life. A budget can help you save towards new goals and keep you on track from overspending with your new lifestyle.
If you and your soon-to-be former spouse are still on good terms, opting for a combination of mediation and counseling can provide you with some of the best divorce results. In part, this is because you won’t have to individually hire experts and professionals, and can instead jointly pay for these services that are essential to the divorce process. Spending less on this now by paying together and having a more amicable divorce means you’ll have more money at your disposal post-divorce.
Of course, being completely amicable is easier said than done; you’re getting a divorce after all. To make this process as easy on you and your emotions as possible, do what you can in advance to prepare for divorce mediation and all of the conversations and feelings that accompany it.
Splitting up your marriage involves divvying up your belongings equally, which includes financial belongings. This part of the divorce can get heated and complicated, as conversations regarding money and who gets what typically can. If you have shared accounts and property, the easiest thing to do is split your assets 50/50. You’ll also want to make sure you’re taking the steps to close down joint accounts as your divorce proceeds.
Where things get a little more complicated is with splitting individually owned assets and property. Typically if anything was acquired during your marriage, then your spouse is entitled to half. However, if you had it before marriage, then there’s potential for you to retain full ownership. The same goes for your spouse. Just be sure to over communicate and document everything you do regarding finances during this time so no issues can arise.
When it does come down to splitting your assets and property, having strong negotiation skills will only benefit you. If you and your soon-to-be former spouse are held up in your divorce proceedings because you can’t decide on a few issues, this is where negotiation can help. Some examples can include dividing a family-owned business, vacation property, etc. Keep in mind, when it comes to divorce, time is money and the sooner you can negotiate an outcome that works for both of you, the better for both your wallets.
You also need to remember that communication is important in negotiation and you should keep those lines of communication as open and friendly as possible. Be honest and ask them to do the same. From there you can negotiate and compromise to something that’ll work for you both.
There are a few options available to you when it comes to housing amid and after divorce. First, if you’re on good terms and can comfortably do so, you and your spouse can continue to cohabitate. This is best if you have children and are trying to ease them into their new normal. Setting some ground rules and even nesting will be crucial here as you figure out both your next steps.
Another option is to find new housing altogether. This can include one of you retaining your shared home or selling that home and both of you finding a new place to live. Your new budget and lifestyle will play a key role here as you determine what you can afford. Look into home financing options that require a lower credit score and less money down, like a FHA loan, as you’ll be less liquid amid your divorce and as you adjust to a single-income lifestyle.
Support comes in many forms, and while emotional support systems are important during divorce, financial support is occasionally more important in some situations. As you move through your divorce proceedings, you may become concerned about how you’ll be able to afford life after divorce. This is where child and spousal support become important.
Part of why divorce proceedings can become complicated is because it’s supposed to produce a fair and even outcome. Knowing what support you’ll be receiving after your divorce can help you budget accordingly as you move forward in life. This additional support can be a relief, especially to parents with primary custody as they continue to provide and care for their children.
Sure, divorce can be scary and full of uncertainties, but with the right amount of planning and protection, it can also be an exciting, fresh start. Finances are an important part of life. By monitoring yours during and after divorce, you’ll be better on track for your new future.