Are you planning to file for divorce?
You may be looking for more information on how to protect yourself financially before and after divorce.
Typically, one spouse is more aware of their financial situation than the other. They likely set up most or all of the accounts you share and have the login information on hand. They might also know exactly which financial institutions they do business with.
However, in this situation, the other spouse struggles with confusion because they don’t know the intricacies of their finances. It isn’t uncommon for the other spouse in this scenario to feel intimidated and stressed. The lack of information can potentially complicate divorce proceedings moving forward.
If you’re preparing for your divorce but don’t know where to start regarding your finances, here are 6 tips you can use to protect yourself.
Searching for a divorce attorney in Houston? Contact the Daniels Law Firm today.
How To Prepare And Protect Yourself Financially Before And After Divorce
Are you stuck and don’t know where to turn when making financial preparations for your divorce? You’re not alone and have a few options to prepare before you file.
However, if your divorce is ongoing, you can still use the following 6 steps to better prepare for your financial situation as a single individual.
1. Hire A Divorce Attorney Who Can Help
Hire a divorce attorney who understands family law as soon as you know you need to do so.
DIY divorces and online platforms that promise a “cheap and easy” divorce are unreliable. They also expose you to making critical mistakes throughout the process. Hiring an attorney you feel you can trust adds personalization and commitment to you and your well-being.
On top of an attorney’s expertise, having a professional who can take care of the details can save you time and stress. An attorney takes a load of the work off your shoulders if you happen to have:
- A full- or even part-time job
- Children or other family members to take care of
- School, classes, or other learning activities
- Volunteer duties
All of these responsibilities take up precious time and effort. Your divorce attorney will be able to focus on you and your legal needs with a sharp mind to help alleviate the pressure of going through it alone.
Need a divorce attorney in Houston? Give family law attorney Cassandra Daniels a call.
2. Identify All Shared Debts
It’s just as important to evaluate assets as it is to determine how much debt you both owe. In this case, think of home loans, auto loans, credit cards, and anything else you share with your spouse that takes away from your net worth. As a couple, your debts will impact the asset division stage of your divorce.
Are Student Loans Considered Shared Debt?
The answer to this question isn’t so cut and dry. If you both had a hand in the application process by applying for it together, you would share that debt. However, if your spouse owes money for student loans before your marriage, you may be off the hook for paying for them. Talk to your attorney to figure out your particular situation.
It’s important to know that when a judge has to divide debt, they can award debt to whomever, as long as it is just and equitable. You also need to remember that the institution you are borrowing from will precede your payback options. Taking on loans requires a contract, which holds you accountable for paying it back.
3. Gather Information For Investment Accounts
You have your 401K, possibly a pension, Roth IRA, and a slew of stock and bond options. Gather those documents and organize them to understand your estimated worth better. For these holdings, account summaries and statements are helpful. Start by listing everything you have and then dive into each to gather these documents.
4. Prepare & Manage Your Expenses
Part of moving forward after your divorce means surveying how your finances will look when you’re on your own. This can be tough for some people to grasp, but it’s important to have a realistic idea to better plan your future.
Create an excel sheet or write everything down with a notepad and pencil. Begin your list with the essentials you need to spend money on, like your mortgage, rent, car payments, etc. If you have children, you will want to consider expenses like food, school tuition, clothing, medications, and other necessities. Keep in mind that you need to discuss child support and custody matters specifically with your attorney.
After you’ve made your list, include other aspects like recurring expenses and payments, credit cards, and personal subscriptions. After this, you can jot down how much you feel you need to enjoy other luxuries like your daily cup of coffee, spa membership, and the once-a-week lunch you plan with colleagues. Those items are expenses you will need to plan to pay for on your own after your divorce is final.
You’ll see how quickly everything adds up, which is why having a plan to protect yourself financially before and after divorce is key to moving on.
5. Litigation Versus Mediation
Litigation is far more lengthy, expensive, and unpredictable than simply agreeing with your spouse. One way to view this is by viewing the court cutting up everything with a machete during litigation. You have no idea what you will end up with, and it is out of your hands.
Successfully mediating your divorce means you have the opportunity to use a scalpel to carve out what you want in a divorce agreement. However, this step is completely up to you and your spouse’s ability to cooperate with one another during mediation.
6. Don’t Forget To Revise Your Estate Plan Post Divorce
Keeping estate plans in mind is one of the best ways to protect yourself financially before and after divorce. Many people forget to change their legal wills and other documents that assign their now ex-spouse as their beneficiary. Don’t forget this step if you plan to make someone else your beneficiary or otherwise in charge of your estate. If you don’t and something happens to you, your ex-spouse may have grounds to fight for your estate if they are still listed as a beneficiary.
Protect Yourself Financially Before & After Divorce With A Family Law Attorney
If you’re unsure how to proceed with planning your finances after your divorce, it will help to talk to an attorney who can offer legal advice before you make major decisions.
Thinking about being on your own can feel overwhelming. Hire the right attorney to help you navigate through the process. Talk to Cassandra Daniels in Houston today.
The information in this blog post is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from Daniels Law Firm or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.