Marriage is a partnership. Most couples marry for love, but once they settle into routine, it's also about managing day to day living. A marriage is a legal contract, after all, and couples share their assets, their home and their finances. One of the most challenging parts of divorce is addressing marital property and deciding who gets what.
When a couple is looking to divorce, there's more to think about than the house and the retirement account. It's important to look into your own personal finances. The longer that you've been married, the more likely it is that you'll have some legwork to get up to speed on personal finances.
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Fortunately, you can start planning your finances before the divorce papers have been signed. Consider that a divorce will very likely change your income situation as you move from a shared household to separate households.
Here are five important things to consider as you prepare for divorce:
- Get your credit report. Independence requires a new home and new bank accounts. To achieve these, you'll need to know where your credit score is at.
- Consider opening new banking and credit card accounts. Many financial issues are shared in marriage. To establish your own credit history you may need independent accounts.
- Monitor existing joint accounts. As you proceed with divorce, it may be wise to close jointly held accounts. Even before they are closed, closely watch all spending.
- Make an inventory. List out all property, bank accounts, debts, and assets you own. Divorce will go more smoothly if you are prepared.
- Plan your future budget. Single life is often more expensive, whether it's the cost of health insurance or rent, to only having one income in the household. Planning your new budget will minimize sticker shock once everything is complete.
Personal and financial lives are intertwined in marriage, and many people don't realize just how connected they were until the divorce is final. It takes time to legally separate finances but, in the meantime, you can begin establishing your independence with these steps. An experienced divorce attorney can help you to preserve your financial status as you go through the process.