For some, the financial toll of a divorce can be quite significant. There are ways around that. An uncontested divorce, for example, or one a divorce which issues become quickly settled may help spouses save money. However, while these divorce paths may be helpful in providing a cheaper divorce, they will likely not prepare you for the financial changes that occur during and after the divorce. Consider the following tips to help you better prepare.
- Tackle your marital debts: If you and your spouse have accrued marital debt, it will not make a difference to creditors whether you are divorced or not. Where your debts were once collective and paid off with a marital fund, you will have to now prepare to pay debts without the additional help of a spouse’s income (if they were working, of course). It may help prevent future headaches if the two of you can chip away at these debts during the divorce.
- Keep an eye on divorce expenses: Have all divorce-related paperwork and bills in the same place and be sure you are regularly paying attention to where your funds are going.
- Be practical with property division: Some spouses may benefit financially from negotiating in the property division stage of the divorce. It may help you to separate the sentimental from the valuable. Is a ten-year-old car worth fighting over? What about the furniture? Perhaps your efforts are better spent trying to obtain stocks or potentially less depreciative assets.
- Update vital documents: You will need to update estate plan and other important lifechanging documents to prevent your ex-spouse from inheriting any assets or making financial decisions for you in the event that you become incapacitated.
- Plan ahead: Your everyday living budget will likely suffer following your divorce if it has not already suffered. If you do not end up with the family house, where do you plan to live? Sonoma’s cost of living is not only higher than the national average, but it is higher than the California average. Do research into the best areas for your budget. If you have children, consider also how you can live within a reasonable distance from them for a reasonable price.
