If you and your spouse have decided to end your marriage, you probably dread having to go through the property division phase of the divorce.
The financial aspect can seem especially daunting. But with advance preparation, you will likely have a less stressful experience than you anticipate. Here are four tips to help you get organized.
1. Gather documents
Collecting the documents you will need takes time. Making a list will help. Basic financial information should include:
– Checking and savings account statements
– Retirement account statements
– Documentation for the mortgage, auto loans, personal loans
– Credit card statements
– Income tax returns, past three years
– Recent pay stubs
– List of marital and separate assets and debts
2. Track your expenses
Your bank and credit card statements will help you track household income and expenses. Include anything you spend money on, such as food, clothing, home maintenance, childcare and entertainment. Determining where your money goes will also help you plan a post-divorce budget.
3. Spend and save conservatively
You and your spouse can continue to use your joint accounts as you approach divorce and the property division process. However, do not go on a spending spree. Resolve to spend conservatively.
4. Avoid making major financial decisions
The divorce will bring about major financial adjustments. It is therefore a good idea to wait until the divorce is behind you to make changes to your will or to name new beneficiaries on your retirement accounts.
A positive outlook
Divorce is not easy for anyone and property division is usually the most complex part of the process. However, advance preparation with a well-organized financial picture will enable you to manage the property division phase of the proceedings with confidence.
