It’s common knowledge that getting a divorce might get expensive. Just how much you will have to spend on divorce is tough to estimate as costs go beyond just hiring the right attorney. Things such as your utilities, insurance, and mortgage payments are all factored in to determine the final cost. So it isn’t surprising that many people are financially banged up while getting divorced. Additionally, you definitely don’t want to see your ex getting through the whole process and emerging in better financial shape than you. Typically, you both should have to bear equal costs for the divorce. To ensure you avoid ending up a financial wreck while getting s divorce, follow the steps mentioned below.
Assess The Amount Of Your Money
You might have more assets than you think, although you probably don’t consider yourself wealthy. It becomes challenging to protect something you don’t even know is there. Hence, when getting a divorce, you must find out how much money you and your spouse have. You need to see the balance of your credit card bills, 401(k), 529 accounts, and savings plans. You can decide better what your financial future will be like after getting the divorce if you know the total of what you own.
Keep An Emergency Fund Ready
You can use a savings account as an emergency fund if you already have a separate savings account. You can also open a savings account for emergencies. Many people would consider a prenuptial agreement to protect the assets and money that you would bring into the marriage.
It’s ideal if you have a savings account that is your legal fund, emergency fund, or rainy-day fund, and it can be accessed by you only; no one else will be able to withdraw from it. It is a smart idea to have an emergency fund even if you have a happy marriage. It will be a good feeling to know that you have access to money even if most of your assets are held in your spouse’s name only.
Be Honest About Your Money
You might be tempted to hide money, especially if you feel that your spouse isn’t worthy of being trusted. But you should refrain from doing it as it is a strategic general mistake, and it might increase the legal fees. It might also result in a rise in contentiousness and a loss of credibility with the judge, who happens to be the most crucial person in your divorce proceedings. You should, of course, take steps to preserve your income and marital assets, but you need to be honest about it.
Keep Your Accounts Separate
You need to get your savings and checking account instantly. You need to work with your spouse to open separate bank accounts. You might be concerned that your spouse may withdraw the money abruptly if you keep it in a joint account. The judge is usually very unhappy if that happens.
You might be concerned about telling your spouse that you want a separate account, as it might mean you end up with no money. To avoid that, you can move half of the money to an individual account before you tell your spouse anything. Just be sure to inform your spouse instantly and maintain complete transparency.
Take the Services of a Divorce Attorney
You won’t require a lawyer if you and your spouse get along well with each other and decide to go for an uncontested divorce. But if things are not so agreeable with you emotionally, then you should consider getting a divorce attorney. A divorce attorney can give you proper advice and guidance if things between you and your spouse go south. The law will protect you if you are worried that the accounts will be drained or that you won’t be able to access your money.
A lawyer can free up any funds for you to spend on your living and legal expenses, or he might be able to freeze any accounts that you feel are at risk from your spouse. Suppose your ex has bought expensive gifts for a third party or drained a joint account; your attorney can adjust those amounts from the settlement numbers. This can be done if your attorney can prove that your ex acted in anticipation of the divorce.
Properly File the Paperwork
Don’t Let The House Affect Your Judgment
Many people want to hold on to their home when getting divorced as they develop an emotional attachment to it. You would think that it’s best if your spouse doesn’t want the house. The truth is, sometimes you may think you won by getting the house, but in reality, you lost. The mortgage payment and upkeep cost may be less beneficial than getting a brokerage asset in the divorce settlement. It could benefit you financially if you downsize to a more affordable home.
Going through a divorce can be very taxing, financially and emotionally. You just need to plan it right if you are going to protect yourself financially. The points we have mentioned above will give you an idea of how to plan ahead so that your financial interests are protected. Take efficient legal counsel if you want everything to go smoothly and come out of it all financially unscathed.