How to Financially Plan for a Divorce

While a divorce is never easy for any of the parties involved, having to deal with financial issues can make it even more complicated. Planning financially for a divorce can cover many issues, depending on how much property the couple has accrued during their time together and whether or not they have children that should benefit from the division.

Difficulty: Moderately Easy

Instructions

Things You'll Need:

• Divorce attorney
• Financial planner

Plan for a Divorce

1. Try to sit down and plan how to divide your possessions. If you can reach a financially acceptable agreement without the intervention of a third party, do it. This will not only save you time and money, but it will also make future dealings with your ex more harmonious, which is especially important if there are children involved.

2. Decide what happens to debt incurred during the marriage. If the debt is small and you can afford to pay it, try to do so together before you part ways. If the amount is too large, you will need to make arrangements. It's practically impossible to divide the actual debt, so you should look for alternative ways of dealing with it. For example, the person who takes the debt could also take the car as a way of compensating for the expense.

3. Consult with a financial planner to resolve tax issues. The main concerns addressed should be related to children and claiming deductions. Couples with no children may have fewer inconveniences regarding this topic, but they should still talk to a professional about deductions allowed for attorney fees and other matters related to the divorce itself.

4. Find out what happens to retirement savings accumulated by the other person. If you both have savings, you can agree to each keep your own, but if only one person in the relationship worked and put aside savings, the other person is legally entitled to half of that amount. This includes all types of savings, from bank accounts to stocks to IRAs.

5. Let a divorce attorney take charge if you cannot reach an amicable decision. Rather than fight non-stop about finances, bring an impartial party along to help decide the best way to divide assets and make sure everyone gets her fair share.

Tips & Warnings

• As you plan financially for your divorce, don't forget the small details. Debts to department stores, schools or friends may seem insignificant at the moment, but they can cause a lot of problems if left unpaid.