Divorces are most often one of the messiest periods in your life. In most scenarios, they are an extended period of high emotions, tough decisions, and lots of arguments. If you anticipate a divorce coming into your life, it’s incredibly important that you take steps to protect yourself financially. Just like when you get into a car, it’s much smarter to put your seatbelt on beforehand, instead of trying to buckle up mid-crash.
This is true even if there are no hostile feelings by either spouse. You and your spouse might still be on good terms, however, you could both have a very different idea of what’s considered fair. If you are not careful, you could very well find yourself in a totally different financial situation than you were before the divorce.
If things are hostile, your spouse could also try to come after everything from your house to your bank accounts. In this type of situation, the best defense is usually a good offense.
With that said, let’s take a look at a few ways that you can protect yourself financially before the divorce.
How are finances split in a divorce?
This usually depends on the type on the type of assets that you have, how many, and what type. It also depends on the nature of the divorce as well as the state that the divorce is taking place. Due to the number of different variables, it’s difficult to offer specific advice.
Luckily, there are a few good general measures that you should take. Here are a few:
- Close any joint bank accounts – Before a divore, you want to separate your cash as quickly as possible. The best way to do this is to close any joint bank accounts between you and your spouse. After this, you should open up your own individual account. This way you can transfer any funds that you will need over the coming months. This keeps you in control of your financial situation and can protect you from getting blindsided.
- Identify any credit accounts – After closing your joint accounts, you should do the same with your credit accounts. During this time, it’s also a good idea to get a copy of your credit report. This way you will be able to identify which loans and credit cards belong to which spouse.
If the entire divorce process seems overwhelming, you should also consider getting a divorce financial advisor. Let’s take a closer look at that.
What does a divorce financial advisor do?
While a divorce financial advisor is not required, it can definitely be an added benefit. A divorce financial advisor usually helps both parties disentangle their finances. Honestly, most divorces are fairly similar. Since they’ve been through the process many times, a divorce financial advisor can help both parties navigate it peacefully.
If there is no hostility from either side, a divorce financial advisor can even be used as an alternative to a lawyer. There’s a good chance that this will end up being cheaper.
Apart from helping you navigate the process, a divorce financial advisor can help you with budgeting/strategizing before, during, and after the divorce. This will help you from feeling overwhelmed if the divorce doesn’t go the way that you want it to.
Can I empty my bank account before divorce?
Yes, as mentioned, emptying any joint bank accounts before a divorce is a good idea. From here, you can open new accounts under your name and transfer your funds into them.
In addition to emptying your bank account, it’s also a good idea to stash any of your cash or personal property. In these types of situations, you want to err on the side of being cautious. People may be acting slightly irrationally during this time, so it’s best to make sure that all of your assets are protected.
Does the length of marriage affect divorce settlement?
Yes, the length of the marriage can affect a divorce settlement. In most cases, a judge will do their best to try and reach an agreement where both parties can continue to live under their same standard of living as they did before the divorce. If one partner earns more money than the other, they can expect to have to support the other financially. This is usually done in the form of monthly payments. The longer the marriage has gone on, the longer these payments will have to be made.
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