A big part of getting on with your future after a divorce involves understanding your current financial picture.
Preparing your finances for property division will not only help you navigate the process but also make a smooth transition to the next stage of your life. Here are four tips to consider.
1. Gather financial information
As soon as you know divorce is on the horizon, begin pulling your financial records together. The basics include:
- Bank account statements
- Retirement account statements
- Credit card statements
- Recent pay stubs
- Mortgage, auto loan and other loan information
- Income tax returns
- Lists of assets and debts
Make a complete set for your divorce attorney and keep copies for yourself.
2. Track your expenses
Track your income and household expenses. Include items such as your expenses for food, clothing, home maintenance, childcare, transportation and anything else for which you spend money. Tracking your expenses now will give you an idea of what to expect in the future. The information will help you understand what you need to live on so you can develop a budget.
3. Put off big financial decisions
Until the divorce is final, refrain from making any big financial decisions. For example, leave the beneficiaries to your will and life insurance policy as they are for the time being. Any major changes will occur as part of the divorce proceedings.
4. Ask for professional help
The more assets you have, the more complex property division will be. Careful preparation will help you avoid financial missteps. This includes relying on legal guidance and adding other professionals such as a CPA or financial analyst to your team if necessary. You want to navigate your divorce and arrive at the next stage of your life with as much confidence as possible.