Preparing for Divorce: Safeguarding Your Finances
Protecting your finances as you prepare for the divorce process is perhaps one of the most important tasks you can take on before your marriage officially ends. Planning is everything, as divorce can easily wreak havoc on your financial standing if you are not careful. Protecting your assets and monetary funds is critical if you want to maintain the lifestyle you are currently accustomed to and ensure your financial future is secure.
Constructing a Game Plan
As a divorcing spouse, you are already facing an emotional toll; the last thing you want is to tack on additional stress due to financial trouble, especially when some of that trouble can be avoided if addressed early on. Here are some important steps you can take to safeguard your finances amidst your impending divorce:
Take inventory - As overwhelming as it might be, taking financial inventory is a must. Sit down and create a list of every account and asset you share with your soon-to-be ex-spouse. You will need to take stock of joint accounts and pay special attention to lines of credit, as well as wills, retirement accounts, and any pending purchases or joint business investments. Also take note of any life insurance policies you opened up while with your spouse. You may wish to modify the policy if you had them listed as a beneficiary. Once you have a clear, thorough list of all your debts, accounts, and belongings, it is time to sit down with your spouse and speak civilly about what you would both like to see happen with each respective item on the list.
Establish your own credit - Whether you are at the beginning of the initial separation process, have a hunch that your marriage is on the rocks, or are diving straight into divorce, it is never too soon to try and establish your own line of credit. If you are on the verge of separating, you are at an advantage; the sooner you establish your own credit, the better off you will be post-divorce. This goes for standard bank accounts, as well. The moment you see your marriage coming to an end, start shuffling away some cash of your own. The divorce process itself costs money, and you will need funds to get by on your own afterward. This is imperative, especially if you have never lived alone or will be on your own for the first time in years.
If you were fortunate enough to plan ahead and prepare a smooth financial transition before the end of your marriage, your chances of experiencing serious bumps along the post-divorce road will be significantly reduced. What do those who have little to no time to plan do? What happens when it’s too late and your separation sneaks up on you, only to illuminate the glaring reality that you have no back-up funds and have made no financial arrangements for an emergency such as a sudden divorce?
Clean up what you can - If your spouse is not cooperating when you attempt to talk with them about money at the end of your marriage, you are left to take control of and manage your own financial situation. This means regrouping, creating a new budget, closing - or putting a stop to - current joint accounts or newly opened accounts, and scraping together what funds you can to support yourself in the meantime. Take comfort in the fact that you are not alone. Many people find themselves underprepared when the divorce bomb hits.
Consult with a professional - Speaking with a professional divorce attorney is critical, regardless of how financially sound you are when your marriage comes to an end. Separating finances and cleaning up the mess can be confusing, so it is important to consult with a knowledgeable Kane County divorce attorney to address your questions and concerns and ensure you understand your rights. Call Shaw Family Law, P.C. today at 630-584-5550 for a personal consultation.