In another post, we've talked about steps to prepare for a stress-free divorce and the more emotional side of this life event. Here, we’ll focus more on some practical steps to consider when going through a divorce.
1. Agree on what you can between the two of you
The more you can agree amicably, the less you’ll need to involve lawyers. A divorce isn’t cheap and if you’re able to work together and compromise, it’ll benefit you both.
You could use mediation, if you've got a reasonable relationship but would prefer a lawyer present. This brings you together in a room with a single lawyer to find an arrangement you’re both happy with.
If you feel you need a bit more professional support, you can try collaboration. Here, you won’t have a single mediator. You'll have your own lawyers and other experts you feel you need – like financial advisers or accountants. This helps make sure agreements are fair, without the cost of going to court.
2. Remember your retirement
It’s normal to focus on the big things when a marriage ends. Where are you going to live? How will it change the family dynamic? And what are you going to live on? But there's a common and sometimes expensive mistake women make during a divorce. It's overlooking the retirement account you each have.
Often, women trade any right to the retirement plan in return for equity in the home. There are lots of reasons why you'd prefer this option, especially if your children live with you. But you need to understand the position this leaves you in when you retire. Don't rush your decision, get some advice, and understand all your options.
3. Your lawyers aren’t financial advisers
Although they can help you divide your assets, they can’t advise you on how to rebuild your finances.
Whatever agreement you end up with, you’ll have split the assets and income. The amount that used to fund one household now needs to support two. There’s a chance you could be living off less than you expected.
Once the divorce is over, take stock. Look at everything from your income and budgeting to rebuilding your emergency savings and retirement account.
And don’t overlook your will or insurance. If you get spousal maintenance, you might want to insure your ex’s life. This could make sure payments will continue if anything were to happen to them.
You’re not alone
You can do this all by yourself. But you might find a Money Coach can really add support, both emotionally and financially. We can help you come up with a plan and stick to it. The best part? We’re around if you ever want to talk too.
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