Your divorce is unique to you and your situation. There are, however, three universal steps that everyone facing a divorce should take before filing (or as soon after being served as possible). Keeping these steps in mind will help protect your financial rights and help ensure that you receive favorable divorce terms.
Step 1: Carefully Consider Your Budget
Your budget – just like your divorce – is unique to you and your living situation. In order to negotiate for financial terms that support your best interests, you need to have a solid working knowledge of your household budget. Many of your expenses are likely to be fairly straightforward, including:
- Your mortgage and the cost of your utilities
- The cost of your life, health, home, and car insurance
- Your average (and any ongoing) medical expenses
- The cost of groceries for you and your children
- The clothing expense for you and your children
- The cost of your monthly memberships and subscriptions
- Your entertainment and vacation expenses
You may also experience expenses that are unique to your situation. Divorces involving high assets, business ownership, or other financial complications tend to require more in-depth efforts.
Step 2: Obtain Credit in Your Own Name
If you do not have any credit in your name alone, now is an excellent time to change that. Having a healthy credit score is necessary for taking advantage of many financial opportunities and for moving forward in an independent life. Steadily building your own personal credit score is far easier than attempting to bring up a low score brought on by inattention. Even obtaining a credit card that you use and pay according to its terms can do wonders for your credit.
Step 3: Gather Your Financial Documents
The financial terms of your divorce will be predicated on your marital financials, but in order to protect your financial rights, you need first to gather the necessary documentation. Financial documents are the pieces that make up the puzzle of your marital financials, which is why there is no such thing as collecting too many. If it is a financial document that pertains to either you or your spouse, it could be relevant, and you should have a copy. Some of the basics include:
- Your mortgage
- You and your spouse’s paystubs
- You and your spouse’s separate and joint bank account statements
- Your income taxes for the last several years
- Titles to your vehicles (and payment information for any you are in the process of purchasing)
- Documentation of any other assets owned by either of you separately or by both of you jointly