Preparing for your financial future after a divorce isn’t easy, but it is necessary. You need to know what you are able to do on your single income. There are several points that you need to consider when you are preparing for this transition.
You should begin to look at your finances immediately when you find out about the divorce. The reason for this is that your financial situation might have an impact on what you choose to do during the property division process.
Figuring out what you can afford on your income alone is especially important. This might impact whether you can try to hang on to the marital home. You will have to know that you can cover the mortgage, upkeep and other related bills on top of your regular expenses. Just remember that you won’t have your ex’s income to supplement your own.
Make sure that you are thinking clearly about different types of assets during the property division process. For example, you need to try to keep your retirement holdings. Some people are willing to trade those out for ownership of the home, but this could actually work against you in the long run. Your retirement accounts are more likely to appreciate while the home might depreciate over time.
Another thing to consider is whether the assets you are considering are taxable or nontaxable. Your goal needs to be not having only taxable investments when you finish with the property division.
On top of all of this, you need to determine whether you have enough money to pay for the divorce or not. This depends on how complex your divorce is, as well as a host of other factors.
Source: Nationwide, “10 Tips to Manage Money During and After Divorce,” accessed Nov. 08, 2017