Divorce is an emotionally challenging process. However, separating from a partner you live with for years can also pose all kinds of financial issues. Because of the costs of legal advice and filing fees, divorce is often expensive. And there are financial struggles that can usually follow after a divorce like adjusting to a single income and moving house. Thankfully, your divorce does not need to be financially devastating. A divorce can be an opportunity to feel more in control of your finances than before. A tacoma divorce attorney can recommend an experienced financial planner to help you deal with your finances during the divorce process and once your divorce is finalized. To avoid financial woes when you decide to end your marriage, here are some tips to consider:
Track Your Expenses
After you decide to cut your tie with your spouse, an important part of managing your divorce and finances is to track your expenses before your official separation. Monitor how much you spend on bills, childcare groceries, clothes, vacations, entertainment, and other expenses.
Avoid Spending Huge Amounts Before the Finality of Your Divorce
If you are not sure how you will afford some of your needs or luxuries after your divorce, you may decide to purchase them before your divorce is finalized. This is possible if you depend on your spouse financially. But, you should avoid spending large amounts of money before you divorce. The courts may review your spending unfavorably.
Avoid Making any Legal Changes to Your Finances
After you file for divorce, you are not supposed to change the beneficiaries of your life insurance or will, or adjust your financial accounts. These changes will be dealt with as part of your legal proceedings, so don’t take matters into your own hands. Otherwise, you could be facing a criminal contempt charge.
Prepare Your Financial Documents
As you organize your divorce and finances, you need to sort through your credit statements, payslips, tax turns, and other documentation. Your divorce attorney will ask for different financial documents while you work through proceedings together. By preparing your documentation, you can minimize the stress and make the process efficient for all.
Understand Tax Implications of Your Divorce
A divorce has tax implications that you and your spouse need to pay after you officially separate. You need to solve different types of tax-related issues including whether you or your spouse get the tax exemption for your dependents and if your attorney’s fees are tax-deductible. Make sure you understand all the tax issues that may arise following your divorce to know your income and outgoings.