For most, emotions get in the way of rational thinking during divorce. The decision to divorce is often times based on negative emotions that can cause a person to jump into the divorce process instead of wade in slowly. There are negative consequences to not "getting your ducks in a row" before filing for a divorce.
Just as with any other life altering decision it pays to take your time, learn where you stand financially and align yourself with an advocate to help you protect your legal rights before and after you file for a divorce.
1. You Will Need a Good Divorce Attorney
Interview at least three divorce attorneys before you decide on one. Go with an attorney who has at least 5-10 years experience practicing family and divorce law. I lean towards a collaborative approach during divorce. It is easier and less expensive if you and your spouse are able to settle all issues without litigation. If that can’t be done make sure you have an attorney who is capable and willing to litigate your case before a judge. You are basically looking for two things…an attorney who knows the value of settling quickly but is also willing to fight for you should the need arise.
2. Get a Good Idea of Where You Stand Financially
You need a clear picture of where you and your spouse stand financially. One of the primary goals of the divorce process is the make an equitable distribution of marital assets and debts. In order to get your fair share during divorce settlement negotiations it is imperative that you know what is owned and what is owed. This is a two-step process:
Determine what you own:
Some marital assets are obvious. It is clear that the marital home, any financial accounts and vehicles are assets that should be split equitably. Other not so obvious assets may include artwork, pension plans, inheritances or belongings brought into the marriage.
Determine what you owe:
When determining what you owe it does not matter whose name any debts are in. Marital debt will be split based on who is more financially able to pay the debt, not by whose name the debt is in. The easiest way to determine marital debt is to get a copy of your credit report. Any debt you have will be listed on your report.
3. Gather Proof of Income
You need documentation showing your income and the income of your spouse. If you and your spouse are salaried employees, you will need a copy of the most recent pay stubs plus your most resent Income Tax Return.
Determining income is difficult if your spouse is self-employed. In such a case, copies of bank account statements and financial business statements will give a clear picture of income. It is a good idea to make copies of such statements before filing for divorce.
You may be able to get an idea of how much your spouse actually makes but, it can be almost impossible to determine true income when a spouse is self-employed. Gather what information you can and then your attorney can help get the rest through the discovery process.
4. Make a Post-Divorce Budget
This is the fun part, figuring out your post-divorce budget. The part where you get to determine what you will have to live on once you are divorced. You are aware of what it takes to run the household now. What you need to know is what your costs of living will be after the divorce. Some people's incomes drop drastically after divorce. Its best you be prepared by building a budget now instead of being hit over the head with bills you can’t pay.
You will have to estimate some expenses but it is important so that you can have some idea of what you will need to survive in your new life. It is also important because it will influence how you negotiate your divorce settlement. You need to know what you will need financially in order to evaluate your settlement options or what you may ask for should your case go to court.
5. Establish Credit in Your Own Name
If you don’t have any credit in your name alone you should establish some now. You can do this by obtaining a credit card but remember you want a card that is in your name only.
Many women find that, after divorce they have a hard time purchasing a home or car because they have spent years sharing credit with their spouse. All that credit you’ve had over the years with your spouse is helpful to him but once you are a single woman, you will get very little ‘credit’ for keeping those payments up.
Once you have a credit card in your name use is sparingly and make sure you are able to pay it off each month. The goal is to establish a good credit score not to run up a bunch of debt. This is done by using credit cards only to the degree that you are able to pay off monthly.
6. Evaluate Joint Financial Accounts
In step two above I discussed obtaining copies of financial documents. If you did that, you now have to figure out what to do with them. It isn’t uncommon, after learning there is an impending divorce for a spouse to raid financial accounts. Sometimes it is done out of anger, sometimes it is done on the advice of an adversarial divorce attorney.
You will want to protect yourself and keep your spouse from being able to clean out any joint accounts you have together. If you fear your spouse doing such a thing you can protect yourself by opening accounts in your name alone, remove 1/2 the funds from the joint accounts, and deposit them into your new accounts.
Do not hide the fact that you have done this and do not spend the money foolishly. Document every penny you spend so that you can have an accounting for it during settlement negotiations or in court. If you have savings accounts, money market accounts or any type investment accounts and you fear your spouse will tamper with those you should consider having the accounts frozen. You should, of course, discuss with your attorney any action you plan to take regarding joint financial accounts.
7. Close All Joint Credit Accounts
Before you separate when possible, pay off and close all joint credit accounts. Closing them before divorce proceedings will keep an angry spouse from using the account and running up charges that you may later be held responsible for.
If you can’t pay accounts in full you can negotiate with a creditor to pay less than is owed on an account.. If this is done, get a letter from the creditor that the account has been paid in full and a written promise that they will not file anything derogatory about the account to the credit reporting agencies.
If you are not able to pay off or come to a settlement agreement regarding the balance owed you should have the accounts frozen. This will keep you from being able to use the account but will also protect you in the end. Once the divorce is final, the balance owed on the account can be transferred to the party the court holds responsible for the debt. If the responsible party does not pay the debt then you don’t have to worry about it affecting your credit score.
Contact and alert creditors to the fact that you are going through a divorce. If there is a change of address, make sure they know it so that you will continue to receive bills from all joint accounts.
Make sure all credit card bills are being paid. Divorce proceedings can take months and all it takes is one late payment to hurt your credit. Even if you have to pay the minimum on accounts that you know will ultimately be your spouse’s responsibility it will be worth it.
8. Making The Decision to Stay or Move Out
The most common question I get from clients considering divorce is whether or not they can move out of the house. Unless there is abuse I normally tell them to stay where they are. There are many reasons for not leaving the marital home. The most important are:
- It could affect the interest you have in the property. If you move out and your spouse pays the mortgage the entire time your divorce case is pending a judge may factor that into any decision he/she makes about property distribution. If the situation becomes too stressful and you feel you have to move try to continue to pay a portion of the mortgage payment. Document well any payments you make toward the mortgage.
- If you have school-aged children and you hope to be able to remain in the marital home until they finish school the last thing you want to do is leave the home. If your spouses income in greater than your income and you want to negotiate him paying the mortgage or part of the mortgage you lose your ability to negotiate keeping the home once you leave the home. Stay put!
Moving out of the marital home can have a negative impact on your case. Do not do it without first discussing the issue with your attorney. In some states, a judge will consider a motion from your attorney for temporary possession of the marital home pending divorce court. You can discuss this option with your attorney.
If there is domestic abuse and you are unable to get an order of temporary possession then it is imperative to take whatever steps you need to protect yourself. Leave the home if you feel you are in danger. If there is a history of domestic violence discuss it with your attorney because he may be able to legally have your husband removed from the marital home.
9. Don't Forget to Take The High Road
This means, no dating, no partying, no hanging out till all hours of the morning. If child custody is an issue in your case you need to make your children your number one priority…which they should already be. Don’t act like a good mother/father, be one. This is an especially stressful time for your children and they need you to stay focused on meeting your child’s needs.
If you become sexually frustrated, get over it. Sex is a luxury, not a necessity. Once you are divorced you can have all the sex you want. Until then don’t let your desire for sex put you in a situation a judge might view as questionable.
Spend time with friends, family and your children. Stay close to home, take care of yourself physically and emotionally, attend to your spiritual life and most of all, whatever you do, be above reproach. Behave yourself!