Divorce Financial Checklist

Develop a financial checklist when dealing with divorce.

Divorce ranks among one of the most traumatic experiences in life. As a result, spouses may not always be able to focus on the financial issues involved. However, not doing so can result in financial hardship for spouses and children as they strive to go forward. It is extremely important to develop a financial checklist. Make sure that your legal and financial advisers are making every effort to protect, represent, and account for your ongoing needs and those of any children who will be involved.

Housing

Evaluate your housing costs, including rent or mortage, insurance and utility bills.

Carefully evaluate the monthly mortgage and other costs relating to your existing home. If you plan to maintain residency, consult with your financial adviser to ensure you do not put yourself at risk for foreclosure. Determine whether you will buy out your spouse and assume the mortgage, and consider the resulting financial impact.

Household Expenses

Compile all of your expenses for a month: food, clothing, cleaning, utilities, water and sewer services, lawn care, and transportation. Keep all receipts. At the end of the month, tally your expenses to get a clear picture of your monthly household expenditures.

Insurance Policies

Prior to settlement and decree, examine your current insurance coverage for health, life and auto. Identify, negotiate and confirm how insurance coverage will continue, uninterrupted and without lapse, for yourself and for any children involved in the divorce.

Educational Expenses

Don't forget to project educational costs.

Calculate all of the expenses for the education of your children: tuition, uniforms, books, transportation, supplies and equipment. Identify costs for children currently enrolled in college, and project costs for children that will be enrolled in the future. Do not jeopardize the educational possibilities for your children. Include the educational cost projections in your financial settlement discussions. Attempt to structure an educational trust or savings plan if at all possible, with provisions for contributions to fund the account.

Assets

List all valuable assets that you acquired during your marriage: artwork, antiques, furniture, electronics, jewelry, clothing and more. Locate receipts as much as possible, or get items appraised to document current value.

Business Valuation

If you started a business during the course of your marriage, get an experienced professional to provide a valuation. Make sure that the valuation includes the current and projected revenue for the next three to five years, the appraised value of equipment and machinery, assessed value of land property (if owned), licenses, trademarks and patents (if applicable). If a business is involved in your divorce proceedings, be sure to consult with your legal and financial advisers.

Taxes

If you have been a "silent partner" in tax filings, now is the time to speak up. If you do not have access to copies of your tax filings for the last three to seven years, have your attorney request copies of all tax filings from your spouse for your files. This information is essential to protect your assets and liabilities, going forward. If you filed your taxes jointly, you could be subject to any IRS requests for an audit or substantiation of information. Make sure that your attorney requests copies of filed tax documents, supporting documentation, and contact information for those who prepared and filed the taxes for the last three to seven years.

References

• Divorce Support: Financial Checklist
• Divorce Magazine: "Financial Planning Checklist"
• I Village: "Divorce, Dollars & Debt"
• Equality Marriage: Post-Divorce Financial Checklist
• Divorce Source: Checklist for a Financial Successful Divorce