A divorce can significantly affect your financial situation, but there are some things you can do ahead of time to minimize the financial consequences.
Cost of Divorce.
The average cost of divorce in the United States is around $15,000. This does not include the often exorbitant legal fees associated with the divorce process. If you are considering a divorce, it is important to begin preparing your finances as soon as possible.
Preparing your finances for a divorce.
Preparing your finances for a divorce can be a difficult and stressful process, but it is important to do what you can to protect yourself financially. If you take the time to do some planning and make smart decisions, you can weather the storm and come out on the other side in a good financial position.
Begin by gathering all of your financial records. This includes bank statements, tax returns, pay stubs, and any other documentation you have regarding your income and expenses. Next, create a budget for yourself. This will help you to determine how much money you will need to live on after the divorce.
Creating a budget post-divorce.
No matter what your financial situation is, creating and sticking to a budget is crucial after getting divorced. You may be used to living on a certain income and now you have to adjust to living on less. To make things easier on yourself, sit down and create a budget of all your monthly expenses. Be sure to include things like housing, food, child care, transportation, and any other necessary costs. Once you have your budget created, look for ways to cut back on expenses. Perhaps you can downsize your home or get a cheaper car. If you have children, explore different child care options that are more affordable. It is also important to start saving money each month, even if it is just a small amount. Having some savings will help you financially if an unexpected expense comes up or if you lose your job.
The importance of financial planning during a divorce.
No matter the cost, divorce is always going to be a financial burden. Whether you are the one initiating the divorce or not, there are going to be expenses that you have to cover. If you are the one who wants the divorce, you may have to pay for attorney fees, court costs, and other miscellaneous expenses. Even if you are not the one who is initiating the divorce, you will still likely have to pay your own attorney fees and court costs. In addition, you may have to divide up joint assets such as property, savings, and investments.
One way to save money on your divorce is to get an online divorce. An online divorce can be a convenient and cost-effective way to end your marriage. You save thousands of dollars on legal fees and avoid the stress of fighting it out in court. An online divorce does require that you and your spouse reach an agreement on the terms of your divorce. However, compromising on some of the terms of your divorce will end up saving you significant money and time in the long run.
Divorce is never easy, but with proper preparation, it does not have to be financially devastating.