7 Steps of divorce preparation to protect yourself financially

couple visiting psychologist

According to statistics in 2017, there were 40,032 divorces in Australia. This means that there were 2 divorces per 1000 people which is not all that bad but still, divorces happen.

Going through a divorce can be a really uncomfortable and taxing experience. You are tearing down all the promises you made when you said: “I do”. Regardless of how amicable or not your divorce is, it’s important to prepare yourself financially for this unfortunate ordeal.

Many times, finances are the reason number one for most divorces.

Have a personal budget

Don’t let the divorce surprise you – know exactly how much money you will have and earn once you finalize the divorce. Many people are left surprised by their income and finances once they are divorced.

That’s why it’s a good idea to make or at least know your personal budget even before the actual divorce happens. If you start living as if you’re divorced with your own finances, the actual divorce won’t be such a difficult transition. Open up a personal account and start your own money savings.

Keep track of financial records

Knowing exactly the situation with your finances and money is important. In many cases, these things tend to get conveniently lost, so knowing beforehand what belongs to whom, are the accounts joint or separate and what happens next is crucial. Knowing how to keep track of finances can be complicated, so it’s best you learn how to manage this process on time.

Don’t make this divorce even more uncomfortable by fighting over things like this. Keep a good track of what belongs to you and what doesn’t.

Hire a good family lawyer

Hiring an experienced lawyer in these kinds of situations is crucial. The feelings and tensions are running high and managing the whole divorce process can be overwhelming and confusing. For example, people in developed countries are dealing with these situations by seeking help from professionals like Doolan Wagner Family Lawyers.

A good lawyer will advise you on all the important things and help you out in difficult situations. This way you will avoid making mistakes and the lawyer will help you keep your finances intact. You can rest assured that you’ll get out of this divorce process without a scratch.

Avoid hiring lawyers who give advice without listening to you and your problems and worries first. Choosing the right lawyer will help you a lot.

Terminate all joint accounts

Compile a list of all the accounts you have, both personal and joint ones. This includes credit cards, savings, loan accounts and so on. This way you can follow what happens to these accounts and if your spouse is trying to move or hide the money during the divorce process.

The next best thing to do, if you see that the divorce is actually going to happen, is to close or freeze all the joint accounts. This way you won’t have to worry about whether or not your spouse is still spending money from those.

So, the best recommendation is to close all joint accounts, open individual ones and you’ll be sure that nothing can be touched or moved without your consent.

Divorce saving fund

Paying for a good lawyer and the whole divorce process can be very expensive. For this reason, starting a divorce saving fund can be a good idea. You can even start a fund even before there is a sign of a divorce, but this can have its own problems and consequences. But sometimes that saying – better safe than sorry – can be well applied in this situation.

Getting a new house, moving out and other similar expenses can be too much on your financial situation. If you have any room, you can start putting a bit of money on the side which can turn out to be a good thing.

Living situation solution

Figuring out your living situation even before the divorce happens is the best thing that you can do. And while you have several options, the best one would be to move out of the joint home.

This can be a difficult move to make but it can also be refreshing and a good way for you to start anew – a clean slate of sorts.

As we mentioned, divorce can be pretty expensive so keeping a close watch on your budget and finances can be of great help. Moving out can prove to be expensive, so think about moving in with your family or friends, or even having a roommate can help out moneywise.

Also, have in mind that even though you do not leave in the same house as your spouse, you are still in obligation to pay the mortgage and other similar expenses seeing as you still own a house together.

Additional expenses

During a divorce process, you’ll be unable to make some big purchases like buying or selling a house or a car. If in any case, you have started a process of these sorts, it would be best to finish it before filing for divorce.

In the case that you have children, regardless of who gets the custody, certain expenses will have to be paid. Things like tuition for private schools and colleges, medical expenses, clothing and so on.

A divorce can seriously drain your bank account, that’s why preparing yourself financially for this kind of process is crucial. Knowing where you stand and how much you own can help you a great deal.

Conclusion

Preparing for this kind of thing is never easy, especially when the emotions are running high. But if you want to get out of this whole ordeal without bigger consequences you must protect yourself and your finances.