Staying Financially Stable Through Divorce
Not only can divorce take a toll on you emotionally, but it can also put a damper on your financial situation if you aren't prepared for the road ahead. Even though it may seem like divorce can put you in an economic downfall, there are some things you can do to stay financially stable. Here are some tips.
Create a Budget
Creating a budget can help you stay in line with what's coming in and what's going out. When living separate from your spouse, you'll need to consider all the expenses you'll be responsible for on your own. For example, you may need to allocate funds for the following each month:
- Car payments
- Rent/mortgage payments
- Health insurance
- Other insurance (auto, renters, homeowners)
It's also critical to factor in the cost of your divorce. During your consultation with your lawyer, get all the information on how much your divorce will cost so you can set aside money and be financially prepared.
Divide Assets Fairly
Diving assets that you and your spouse have accumulated can be a complicated process. Since Colorado is a marital property state, not a community property state, your assets will be divided equitably between you and your spouse. Equitable distribution does not mean that everything is split down the middle. It means everything is distributed fairly. The courts consider things like each spouse's contribution to the acquisition of the property and the economic circumstances of each spouse at the time of the division.
It may be tempting to try to save money by going through the process without a lawyer, but it can cost you in the long run because you won't get everything you're entitled to. For more information about equitable distribution and your rights regarding splitting your assets fairly, speak to your divorce lawyer.
Square Away Debt
If you and your soon-to-be ex-spouse have joint debt, it may be beneficial to pay it off before finalizing your divorce. If your spouse doesn't agree to pay a debtor or does not have the means to contribute to paying off the debt, it can be a tricky situation. If the courts decide that your marital debt will be split equally between you and your ex, talk to your lawyer about adding an indemnity clause to your divorce agreement to protect yourself from creditors for his or her share. An indemnity clause will allow you to take your ex back to court and be compensated for any money owed if they default on a loan.
Update Financial Documents
Once your divorce is final, you'll need to update financial documents and other data to reflect your new marital status. Here are some things to consider:
- Change titles to your car and house to accurately reflect who owns them.
- Update your wills, power of attorney, and health care instructions.
- Remove your ex-spouse as an authorized user from credit cards.
- Close joint bank accounts/open bank accounts in your name alone.
- Update beneficiaries on life insurance and retirement accounts.
Address Financial Matters of the Children
If you have children, it goes without saying that you have their best interest at heart. Whether you are the custodial parent or non-custodial parent will determine how much you'll need to financially contribute to their care, such as child support and other costs associated with your children. When it comes to children in divorce, it can be complicated. Consulting an attorney regarding child support and other financial matters is critical to ensuring your child's needs are met without putting you in a compromising financial position.
Need Help With Your Divorce? Drexler Law is Here For You.
Going through a divorce is not only an emotional life event, but it can also wreak havoc on your finances if you don't prepare and have professional legal help to protect your assets. When you are ready to start the divorce process, consulting an experienced attorney can make all the difference in the outcome of your case. Know that you are not alone, and Drexler Law is here to help you every step of the way.
Contact our Colorado Springs divorce attorneys today at (719) 259-0050 to schedule a consultation.