Tips For Effective Money Management During Divorce
The average cost of a divorce lies anywhere between $15,000 and $20,000 depending how complex the divorce is. This means you can suffer financially before the divorce is finalized and you get your share of the marital assets. However, you don't have to suffer financially just because you are divorcing your spouse. Take these precautions to keep your financial sanity during divorce:
Consult a Financial Advisor
Consultation with an advisor is advisable if you weren't properly involved with your family's financial transactions. An advisor will help you with the basics of finances, such as filing taxes and dealing with monthly bills. Maybe you didn't even know how much you were paying for living in your house. Things like rent, utility bills, or even yard upkeep expenses can overwhelm those who aren't used to them. For example, an advisor can help you avoid moving into an expensive house during the divorce process.
Prepare a Budget
Prepare a budget and try to stick to it. It's not easy to know upfront how much your divorce will cost, so you need to be frugal if money is tight. For example, it might be a good idea to postpone that sports car you were planning to buy until after the divorce. Note that it is more expensive to maintain two separate households than to maintain one, so it may be difficult to have the same standard of living as before.
Don't Go On a Spending Spree
It may be tempting to go on a spending spree, especially if you are the main breadwinner, but that would be a mistake. If the divorce court decides that you have been wasting money, it may reduce your property award proportionally during property division. This is especially likely if you are spending money in ways you wouldn't have done during the marriage.
Get Good Temporary Spousal Support
Lastly, if your spouse earns more than you, you are entitled to temporary spousal support. Therefore, don't rely on handouts from your partner to survive until the divorce is finalized. Consult an experienced divorce lawyer to submit a petition for temporary spousal support so you don't suffer irrespective of the length of the divorce.
In short, divorce requires careful planning and execution. The best way to approach it is to identify an experienced divorce lawyer and follow their advice since they have handled cases similar to yours. The lawyer may suggest consulting other professionals, such as a therapist and forensic accountant; consider the advice carefully.
