How Can I Financially Prepare for Divorce?

man checking financial information on a smart phone while doing his bookkeeping

Divorce is a difficult and emotionally charged process, made all the more complicated because it often has significant financial implications. If you're currently going through a divorce, or are considering one, it is vital to take steps to prepare financially. Horton & Associates, LLC can help provide tips on accomplishing this.

Create Your Budget

One of the first steps you should take when preparing for a divorce is to create a budget. This will help you better understand your financial situation and make informed decisions about your spending going forward. It is crucial to be as detailed as possible when creating this budget.

Seek Alimony if Needed

If you're relying on your spouse's income to maintain your standard of living, you may be entitled to alimony payments after the divorce. Alimony is typically awarded for a limited period of time; you should consider seeking legal counsel to determine if it's right for your situation.

Keep Records of Expenses

It's important to keep track of all your expenses during the divorce process, as this can be helpful in negotiating a settlement with your spouse. Make sure to keep receipts and bank statements so you have a record of what was spent. Furthermore, specific documentation will be necessary for the divorce process.

Sell the Family Home if Necessary

The family home is often one of the most valuable assets in a divorce. You will have to consider if the choice to keep or sell is best for you and your spouse. If you do decide to sell, be sure to consult with a real estate agent to get the best possible price. Keep in mind that you can opt to keep the marital home as well, especially if you want to maintain that routine for your children.

Consider Your Retirement Accounts

Retirement accounts are often another major asset in a divorce, it is necessary to divide them carefully in order to avoid any penalties or taxes. You should consult with a financial advisor to ensure that the division is done properly.

Update Your Credit Cards

If you have joint credit cards with your spouse, it's vital to get your own credit card before the divorce is finalized. This will help you establish your own credit history and avoid any issues with joint accounts after the divorce.

Establish New Banking Accounts

Once the divorce is finalized, you'll need to establish new banking relationships in your own name. This includes opening up new checking and savings accounts and closing any existing joint accounts.

Remember Insurance

Health insurance is often one of the benefits that are lost in a divorce, so you will need to review your coverage and make sure you're still adequately insured. You may need to purchase your own health insurance policy or sign up for a government-sponsored plan such as Medicaid or Medicare.

Update or Rewrite Your Will

Finally, it is necessary to draw up a new will once the divorce is finalized. This will ensure that your assets are distributed according to your wishes and not those of your ex-spouse.

Seek Professional Advice

Dealing with finances during and after a divorce can be overwhelming, so don't hesitate to seek professional help if needed. An experienced family law attorney and financial advisor can assist you in making sound decisions about your money during this difficult time.

Honest and Accessible Attorneys in Bluffton, SC

Going through a divorce is never easy, but you can make the process go more smoothly by taking some time to prepare financially. Keep these tips in mind as you navigate through this difficult time and seek professional help when needed. The team at Horton & Associates, LLC is here to provide legal assistance when needed.

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