The New Year means it may be the time you decide to file for divorce. However, before you jump right into it, you should take some careful steps. Getting a divorce can leave your finances in tatters if you are not ready for the process.
You should get a few things in order before you start the divorce so you can protect your finances. Follow the steps below to financially prepare yourself for the end of your marriage.
1. Gather financial records
The first step you should take is to organize your financial documents. You should have five years of tax returns, bank statements, payroll stubs, benefits information, investment account details and property information. Collecting evidence of your money and assets will help make the divorce discussions go more quickly.
2. Keep an eye on your credit report
You will need to remain completely aware of your financial situation. One of the best ways to do this is by getting a copy of your credit report. Pay attention to your debts and monitor your report throughout your divorce so you can avoid surprises.
3. Open your own accounts
Once you know you are going to file for divorce, it is time to open individual accounts. You should consider opening a credit card, checking account and savings account in your name at a different bank. Once your divorce gets underway, you can close any joint accounts so you are not liable for any debts your spouse racks up,
4. Budget wisely
According to a report by USA Today, your lifestyle after divorce may change dramatically, and it is key to start budgeting now. You may not have access to the same amount of money as before and you will need to adjust your lifestyle. Cut unnecessary expenses to accommodate your soon-to-be-single life and build savings.
Going through a divorce can be financially damaging, but you can come out the other side without experiencing devastation if you follow these four tips.