It may sound counter-intuitive to plan or make financial preparations to divorce, but it’s one of the smartest things you can do to avoid falling into the divorce debt trap. Dividing debts is one of the more difficult parts of divorce proceedings for most couples. When debts are divided, creditors often do not acknowledge the reassignment. The issue with creditors not accepting the divorce settlement is not a problem as long as your spouse pays as agreed, but if they don’t, the debt still technically belongs to whoever is on the creditor’s files. As you can see, this can be a serious problem for couples mired in debt. The short answer is, yes, you should financially prepare for your divorce if you can.
Eliminate the Debt Before Filing If Possible
If it’s possible, you and your spouse need to work feverishly to eliminate your shared debt. It’s a tether to your marriage that will haunt you after the ink on your divorce has dried and been filed away. If you didn’t manage to eliminate it before you file for divorce, it would be beneficial for both parties to eliminate it before finalizing.
Five Ways to Financially Prepare for Your Divorce
A divorce settlement will outline who is responsible for any debts, but the goal is to go into your divorce proceedings with as few legal tethers to your spouse as possible. It’s probably not possible to eliminate your financial entanglements instantly, but here are four ways to financially prepare for divorce.
- Get a Financial Professional to Help: If money is not your strong suit, then do not waste time trying to figure out how to get your finances in order without help. While a financial advisor won’t be free, the money you save by cleaning up your financial situation will be worth the expense. Plus, divorce financials and the divisions of debts and assets can be confusing, so it’s best to get help where you can.
- Calculate Your Fiscal Health: Do you know how much cash you have available in your accounts? Do you know how much debt you have? You should know how much you have in your accounts and what debts you have individually and as a couple.
- Stick to a Budget: If you can trim the fat and save some money, now is the time to do it. Try to spend as little as you can so you are prepared to start a new life and pay any attorney’s fees after the divorce is finalized.
- Locate Documentation for Assets and Debts: You need to find the title to the car, the deed to the house, any insurance paperwork and find out who’s the current legal owner of these items. If you still owe money for your car or have any debt associated with your shared assets, you will need documentation to show the amount due. Plus, if you own any property as a premarital asset, you will also need proof of your sole ownership.
- Choose an Amicable No Contest Divorce: When the divorce is agreeable, you’re more likely to end your divorce quickly and for less money. Agreeable spouses have the easiest way forward through their divorce, and they are in a better position to protect their financial health.
Protect Your Financials by Opting for a No-Contest Divorce
Divorces are each unique to the two people going through the process. Before making any serious choices regarding your finances or divorce filing, contact an attorney or financial professional. Plus, you can save money on your Pennsylvania divorce filing by contacting Cairns Law Office. Ask us about our $299 no-fault divorce! Call us today at (888) 863-9115 to schedule a consultation or to request more information.