The expense of divorce can make a difficult life event harder. Before you file for divorce, you should examine your financial planning and get your affairs in order.
Financial planning can help avoid hidden costs and improve the outcome of your divorce.
Dividing your assets
If your divorce is financially complex, consider discussing your options with a family lawyer and a financial advisor. Some finance professionals specialize in managing clients’ finances during a divorce. You might think splitting all property equally between you and your spouse results in a fair outcome. However, taxes and other fees can make a division of certain assets costly. Ideally, you and your spouse can cooperate to minimize expenses as you divvy up your assets.
When discussing your divorce, whether you are with your financial advisor or your attorney, you should present all the information regarding your assets and bring appropriate documentation. For example, you need to gather paperwork pertaining to businesses you own, your real estate holdings and your investment portfolio. You should also bring statements from your checking and savings accounts, tax returns and credit card bills to provide a full picture of your finances.
Revisit estate planning
Divorce is a good time to examine your estate planning and make necessary changes. For instance, you can remove your former spouse as a beneficiary after your divorce. You might want to allot more of your property to your children or other loved ones. Also, you can name someone else with power of attorney in your estate planning documents if you had previously named your spouse.
By organizing your finances and planning ahead, you can avoid losing assets unnecessarily during your divorce.