Pre-Divorce Planning: 8 Steps To Secure Your Financial Future

Divorce and Transitions: Mardi Winder-Adams

The Importance Of Pre-Divorce Planning:

The process includes emotional and financial complexities that can quickly spiral out of control. Unfortunately, many women fail to do any advanced planning and preparation before announcing they are leaving the marriage, which creates the potential for the spouse to do a lot of damage. 

If you believe your spouse will be hostile, aggressive, resentful, or will lie during the divorce, or this has been a pattern in your relationship in the past, pre-divorce planning is essential to protect your assets and your sanity. 

“Having these documents readily available will save time and reduce stress during the divorce proceedings”

By taking the time to prepare and organize, you can navigate this difficult period with greater confidence, clarity, and control. Here’s why pre-divorce planning is crucial and how you can get started. And, as a bonus, you don’t need a lawyer or any money to get this done. 

1. Gather Financial Documents:

One of the first and most important steps in pre-divorce planning is gathering all your financial documents. This includes bank statements, tax returns, mortgage documents, retirement account statements, and any other records that provide a comprehensive picture of your financial situation. Having these documents readily available will save time and reduce stress during the divorce proceedings. 

You will need to give this information to your attorney, so this is a beneficial first step. Make sure you also identify any financial institutions or investments you think your spouse may use or have, even if you don’t know all the details. 

2. Understand Your Budget And Expenses:

Creating a detailed budget is an overlooked but critical component of pre-divorce planning. This means tracking your income and all your expenses, including fixed costs like mortgage payments and utilities, as well as variable costs like groceries, entertainment, and personal care, including all the expenses for the kids if they will be living with you. 

Understanding your budget helps you see where your money is going and identifies areas where you can cut back if necessary. It also provides a clear picture of your financial needs post-divorce, allowing you to negotiate more effectively for spousal or child support if applicable. A well-defined budget is a powerful tool for managing your financial future.

More importantly, it lets you know what to expect if the spouse leaves the house and stops contributing to the bills. This often happens in the initial phase of the separation or divorce before temporary orders are in place.

“A well-defined budget is a powerful tool for managing your financial future.”

3. Assess Your Financial Situation:

Once you have gathered all your financial documents, the next step is to assess your financial situation. This involves taking a detailed look at your assets, liabilities, income, and expenses. Understanding your financial health is crucial for determining how to divide assets and debts equitably. 

It’s also wise to open a separate bank account and credit card in your name if you haven’t already. This will help you establish your own financial identity and ensure you have access to funds during and after the divorce. Ideally, use a bank or credit union you have not used before.

Before you put an address on the application for a new bank account or credit card, be sure to read the next tip!

4. Rent A PO Box, New Email, And A Burner Phone:

Privacy and security are paramount during a divorce. Renting a PO box is a simple yet effective step to ensure that your mail is secure and private. This is especially important if you are still living with your spouse or if you anticipate any conflict over shared mail. Having a separate mailing address allows you to receive sensitive documents and correspondence without fear of them being intercepted or tipping off your activities. 

For the same reasons, having a new email account and a burner phone allows you to control access to communication from your lawyer, financial advisor, or others on your divorce team. 

5. Change All Passwords On Personal Accounts:

In today’s digital age, changing all passwords on your personal accounts is a crucial step in protecting your privacy. This includes email accounts, social media profiles, online banking, and other accounts containing personal information. Don’t forget to password protect any digital storage for photos or other personal documents. 

Make sure to choose strong, unique passwords that are difficult to guess. Do not use special dates, the names of your children, pets, favorite songs or movies, or anything close to a password you have used before. 

This step is not just about preventing access; it’s about reclaiming your digital security and ensuring that you have control over your personal information. Protecting your online presence is as important as safeguarding your physical documents.

6. Talk To A Certified Divorce Financial Planner:

Divorce has significant financial implications, and consulting a certified divorce financial planner (CDFA) can be incredibly beneficial. A CDFA specializes in the financial aspects of divorce and can help you understand the long-term impact of your financial decisions. They can assist in creating a realistic post-divorce budget, analyzing settlement proposals, and planning for your financial future. Working with a CDFA ensures you make informed decisions aligning with your short- and long-term goals. 

7. Hire A Divorce Attorney:

Legal representation is essential in a divorce. Hiring a knowledgeable and experienced divorce attorney ensures that your rights are protected and that you are well-represented throughout the process. Your attorney will guide you through the legal process, help you understand your options, and advocate for your best interests.

It’s important to choose an attorney who understands your specific needs and has a track record of handling cases similar to yours. An attorney provides the legal backbone to your pre-divorce planning, ensuring that all aspects of your case are handled professionally and competently.

“Legal representation is essential in a divorce.”

8. Plan How To Talk To Your Spouse:

Communication is crucial in the divorce process, and planning how to talk to your spouse about your decision to divorce is vital. Approach this conversation with clarity and compassion but also with a clear message that you are moving forward with the divorce. 

Choose a time and place to talk without interruptions, and prepare for an emotional response. Having a plan for this conversation can help reduce anxiety and set the stage for a more amicable divorce process. Effective communication can significantly impact how smoothly the divorce proceedings go.

Pre-Divorce Planning, Taking Control Of Your Future:

Pre-divorce planning is not just about preparing for the legal proceedings; it’s about taking control of your future. Divorce is challenging, but with careful planning and preparation, you can advocate for yourself and your children. 

Educate yourself about the process, stay focused on your goals, and know that you are not alone. With the right preparation, you will have the information needed to complete the paperwork, provide accurate information to your attorney, and know you are getting a fair settlement. 

Did you enjoy this article? Become a Kuel Life Member today to support our Community. Sign-up for our Sunday newsletter and get your content delivered straight to your inbox.

About the Author: