Managing Your Finances During a Divorce
If you and your spouse have decided to go your separate ways, it is important that you do whatever you can to make sure that you maintain your financial stability after the divorce is finalized.
First, it is important that divorcing spouses compile all asset-related documents to get an accurate picture of what assets will be considered during the property division portion of the divorce. In Tennessee, marital property is subjected to equitable division, meaning that the court will decide how to fairly distribute the property acquired during the couple’s marriage. Therefore, it is your job to gather financial statements, trusts, insurance documents, property deeds, and other documentation to establish the existence and value of your assets.
Assets are not the only thing subject to division. Debt can also be divided between divorcing spouses and should be accounted for. Debt can come in many forms, including student loans, credit card debt, property liens, and can be the responsibility of one or both spouses upon divorce.
Once you have collected your documentation, experts recommend making sure you have enough cash on hand to support yourself during the divorce process, as you will need it to pay for housing, transportation costs, home maintenance and other costs. You will also need to consider the fact that you may not be able to afford to keep the family home or other expenses after your divorce, since you will no longer be a part of a two-income household.
The next steps involve planning for your future. You will need to consider your plans for retirement and determine how existing retirement assets will be distributed, as well as adjust beneficiary information if necessary. You will also need to find your own healthcare coverage if you were covered under your spouse’s workplace plan during the marriage. Finally, you will have to consider how your taxes will be impacted by the divorce. For example, as of 2019, if you are paying alimony, you can no longer take a tax deduction.
Protecting your finances during a divorce can give you peace of mind in the long run. A family law attorney in your area can review your case and help you as you go through the divorce process.