4 Steps To Take When Divorce Is Inevitable

If you believe that your marriage is on the rocks, or that your spouse is planning a divorce, it is essential to have a plan to protect yourself and make sure your family and your future will be secure. Before you do anything though, take a step back and get your emotions in check. Making impulsive financial decisions based on emotions of anger, revenge or fear is never a good idea.

Step 1: Prepare a comprehensive inventory of marital property

Gather and make copies of information on all your assets, debts, sources of income, expenses, tax information, real estate holdings, and employee benefits. If you have valuables in the house such as tools, machinery, coins, guns, artwork, jewelry, etc. take photos (with dates) to document exactly what is there. Keep copies of all of this information in a location that your spouse cannot access, such as with a trusted friend or family member, in your file cabinet at work, or by establishing an electronic drop box and scanning all copies into a file.

Step 2: Get a handle on your cash flow

It will be critical to know how much money you require each month to cover your expenses. Now is the time to sit down and determine what your household income is and how much is being spent monthly so that you can develop a reasonable spending plan both during and after the divorce is finalized. Think of ways to tighten your belt on unnecessary spending. Some suggestions include canceling premium cable and newspaper/magazine subscriptions, packing your lunch, avoiding trips to the coffee shop (make and bring your own), clip coupons, and buy sale items only vs. paying full price.

Step 3: Establish personal financial accounts separate from your spouse

If you don't currently have a savings and checking account in your individual name, you need to open them; and don't use the same bank that you and your spouse currently use. Set up online access so that statements won't be mailed to your house. If you need paper statements, you could also set up a confidential email account with a different provider and have all statements directed to it. You can use a trusted friend or family member's address for where your statements are sent (but be sure to set up your actual address as your legal address with the bank).

Step 4: Don't rush into decisions

Divorce is one of the biggest financial decisions that you will ever have to make. It should not be taken lightly or rushed into. Emotions can run very high during a divorce, which could cloud your ability to make a good business decision. One wrong move could put you at a financial disadvantage for years to come. Be open to the idea of hiring a Certified Divorce Financial Analyst (CDFA) to help with all of the financial decisions you face. Having someone who can illustrate the ramifications of dividing all the marital property will help you understand whether a settlement is fair to you and if it will be realistic for you over the long run.

Written by Donna Cheswick (Originally published at DivorceMag.com)