For some odd reason, most humans have a reflex reaction to tragedies like divorce: they go shopping. While theraputic outlets are recommended, this doesn’t mean the local clothing outlets. Every year, thousands of men and women are left in dire financial straights as the result of a divorce. Before you go buy that new bread maker or flat screen television, take a look at these tips to help prevent you from ending up financially injured:
Know Your Partnership’s Value:
You need to have a clear understanding of your partnership’s total assets and debts. This means reviewing all relevant documents related to credit, getting property value assessed and understanding all soft assets like pension plans, stock options, insurance plans, etc. The more of this work you do before meeting with a lawyer, the more time and money you will save.
Protect Your Credit:
Until your partnership is legally dissolved, you and your partner share responsibility for your household’s debt. Immediately close any credit cards held in both your names. If you don’t have an individual checking account or credit cards in your name, start applying for them now to establish your own personal credit.
Know the Spectrum of Possibilities:
Most states use equitable distribution laws when dividing assets. This means that a judge decides. The leaves a lot of room for interpretation and, if you and your partner don’t agree on a settlement, there is little way to predict what the outcome might be. However, talk to your lawyer about the range of possibility. Look at your future should the worst case scenario happen and begin making lifestyle changes to prepare yourself for any situation. Evaluate your income sources and begin planning for ways to expand your personal revenue. Start budgeting and look for places you can cut on expenses until the divorce process is completed and you have more security.
Learn New Skills:
If you weren’t very involved with your partnership’s financial transactions, then it is important you learn how to perform these tasks now. From balancing the checkbook, to paying bills, to managing stock portfolios — these activities are now your individual responsibility and you need to do it well.