Divorce is an ugly thing. Even when it’s nice, it’s still ugly. Obviously, it has an effect on finances. Either you and your spouse had jobs, in which case your income is about to be cut down, or you were relying on your spouse’s income, in which case your income is being eliminated.
So, the divorce looks like it’s happening. What should you do? How should you move forward? This article will go over some quick tips on how to start preparing yourself for this long and difficult road.
File a legal separation
A legal separation bifurcates assets between a couple. This means your spouse’s financial activity no longer affects you. This is valuable, especially if you need to rebuild credit. Assuming your spouse has poor credit with a lot of debt, that will affect your score. The separation protects you from these headaches. Please note that if you and your spouse are both named on a credit card, that card remains in both your names regardless of the separation and will affect your credit. So, make sure you are not a part of any joint credit that you don’t want to keep.
Be conservative with your money
As stated before, when it appears the divorce is happening, your financial situation is heading towards a huge shift, especially if there’s been a legal separation. You’ll need to start spending far less than you normally would because the amount of money in your account is about to dip. This is when budgeting becomes a huge thing. Take a look at your monthly expenses and try to figure out what your individual costs will be. You might have to run lean, but you’ll be in a better financial situation if you do.
Leave the big decisions to the court
All this means is don’t make any big changes to any retirement account, beneficiaries, etc. That stuff gets settled in the court with the judge. Making preemptive changes could be a big mistake and potentially end up costing you.
No one likes divorce. Please be safe if this is the path you choose. And of course, seek legal advice from a professional.