The decision to file for a divorce is likely to be an emotional one rather than a financial one. Therefore, even if you are not sure that you can afford to go through a divorce or if you are uncertain about how it will affect you financially, you may decide to file anyway. Alternatively, you may have decided to file for a divorce before losing your job and entering a tough financial situation.
If you are currently in the midst of a divorce while struggling financially, you must pay attention to certain aspects of your finances. The following are some tips on financially surviving a divorce.
Focus on housing
Making sure that you have somewhere to live after your separation, and making sure that you can afford your accommodation, should be your priority. Even if you “win” the family home after the divorce is finalized, you may not have the income to be able to keep up with mortgage repayments. If you do not prepare for this in good time, you may face foreclosure.
Make sure that assets are correctly categorized
During a divorce, all assets owned by the couple fall into one of two categories: marital assets and separate assets. All marital assets are subject to division, whereas separate assets will remain in the possession of whichever spouse owns them. To get the best possible financial result, it’s important to ensure that you correctly assign all assets and that you do not allow any of your separate assets to be mistaken for marital assets.
Agree to work together
Generally speaking, contested divorces are more expensive because they involve court battles. In addition, they may not always lead you to have a better financial outcome. This is why attempting to collaborate with your spouse could potentially lead to a much better financial situation. Not only that, but it could also help to create a better relationship between the two of you, which will be particularly important if you have children together.
Going through a divorce can present you with financial hardships, but by taking early action and creating strategies to tackle these, you’ll likely overcome them and be able to move forward positively in your life.