If you have been thinking about divorce, it is never too early to start making preparations. Plenty of people take time to think about the logistical preparations, but may not consider what they should be doing to financially prepare for divorce. No matter what financial situation you are used to, it will change after a divorce. Making preparations right now is the best way to meet the forthcoming changes as they arrive.
Preparing for divorce is never easy, but it is important. It should start as soon as you first contemplate the possibility. Here are 5 ways you can start financially preparing for divorce, no matter where you are in the process:
Take Stock. The best first step is just to look at what income you are bringing in and what expenses you are incurring. You don’t have to create a foolproof post-divorce budget at this stage in the game, but taking a hard look at where your funds are will tell you a lot about what the immediate future may look like.
Find Documents. You will need official copies of documents like bank statements, pay stubs, and tax returns when getting divorced. These documents are used to help decide alimony and child support. Washington courts look at six months of pay stubs and two years of tax returns and W-2’s. Two years of bank statements are the best practice, but if you don’t have access to that, find as much as you can. Retirement statements are hugely helpful if you have them!
Avoid Big Purchases. Getting divorced is not the time to make any big purchases, whether they are impulse buys or pre-planned. This means you should hold off on getting that boat you’ve always had in the back of your head. These will be looked at in the process and may be used against you.
Cut Corners Where You Can. When looking at your expenses, try to find places that you can conserve money. This may seem daunting at first, but you will be surprised at how much you can live without. Cutting corners is a great practice to get into that will help prepare for any major changes going forward.
Ask For Help! There are big financial questions on the table, such as how to handle any joint accounts and purchases. In order to advise on your actual situation, we need to hear it directly from you. Reach out to Akiona Law for help with all aspects of your divorce, including your finances and what you should be doing to protect them. We offer supportive, experienced guidance toward efficient, cost-effective solutions.