As you prepare for the divorce process, it’s critical to focus a good amount of attention on your finances. Neglecting to do so can lead you to additional challenges in the future.
While there is no right or wrong way to prepare your finances for divorce, here are five steps you can take to give yourself peace of mind:
- Gather all necessary financial documents: This includes but is not always limited to bank statements, retirement account statements, pay stubs and tax returns. Also, you should make a list of your assets and debts, as these will play a big part in the divorce process.
- Review your credit report: You need a clear idea of where your credit stands and how it will affect you in the future. For example, if you have an excellent credit score, you’ll find it easier to secure a car loan and/or rent an apartment post-divorce.
- Create a budget for the future: With your finances changing, create a budget to guide you in the future. Take into consideration how much money you’ll earn post-divorce, as well as your monthly expenses.
- Close joint accounts: Don’t make the mistake of leaving joint accounts open, as this gives your soon-to-be ex-spouse the opportunity to continue to use them. For instance, if you have joint credit cards, consider the best way to pay off the balance and then close the accounts for good.
- Open individual accounts: Your financial life is changing, and now that you’re 100 percent in charge, you should open individual accounts. For example, a checking and savings account is a good place to start. You can then move onto a credit card account, retirement account and any others that make sense.
When you take these steps, you’ll find yourself feeling better about your finances as you move into the divorce process.
Taking the next steps
Once your divorce is in the past, you should once again review your situation to decide what to do next. It’s your hope that the steps you took up front will position you for success in the future.
Visit our website for more information on how divorce will impact your finances, how to protect your legal rights in Connecticut and other related topics.