6 Ways to Financially Prepare for Your Divorce
Uncontested Divorce Mediation
Posted January 23, 2019
You think that the biggest impact a divorce will have on your life is living without your spouse. And that will definitely be a profound difference. You will be making decisions on your own, living on your own, and experiencing all the freedom that comes with being one person instead of a pair. But in practical terms, the biggest life impact is going to be money.
A divorce can change everything about your now separate finances. Your accounts will need to change. Your taxes will change. Your insurance will change. But there’s no need to let all these financial changes hit you like a freight train right after your divorce is finalized. For anyone experiencing the divorce lead-up, especially if you are mediating an uncontested divorce in Denver, it is very possible to get most of your financial changes sorted out well ahead of time.
Let’s take a look at six different ways you can prepare your finances to transition smoothly into two separate financial lives after the divorce.
Find Individual Insurance Coverage
Most married couples are on each other’s insurance policies. As beneficiaries on health insurance, as household drivers on car insurance, and as co-account holders for things like home and business insurance. Needless to say, you’re going to need separate insurance coverage in the near future and there’s no reason to put off this task until the divorce.
You can easily use the time leading up to your uncontested divorce in Denver to shop around for individual policies that will neatly halve and replace any insurance policies you shared with your spouse. If you’re on decent terms, you should also consider working together to split your insurance to make sure all bases are covered by the new policies on both sides of the line.
Open a Personal Bank Account
Joint checking and savings makes sense when you are sharing a life and household with someone. But now that you’re building separate lives, it’s also time for separate bank accounts. You don’t have to wait for your divorce to get started; if you and your spouse have similar incomes, work with your spouse early in the process to determine a fair way to divide expenses so that you can each establish your own bank accounts. Creating reasonable, clear expectations regarding the allocation of expenses will save both of you many headaches down the road.
By having your own bank account, you can start depositing your paychecks separately. And with this account, you can build up a personal reserve of money that is all yours to spend. Or, more likely, to save until all your post-divorce expenses shake out.
Separating your accounts early and fairly dividing the joint account money is a great way to avoid any awkwardness about splitting up the joint account later. And having your own account is key most other steps involving building a new independent life before or after your uncontested divorce in Denver is final.
Close Joint Credit Accounts
Some couples have opened joint credit cards and this can be pretty useful in a marriage. For covering household expenses, as a shared emergency fund, or as your shared vacation card. But if you wouldn’t have a joint credit card with a work friend, then you shouldn’t have one with your ex. Joint credit is a very dangerous line to have open with someone you don’t trust 100% not to do something foolish that might hurt both of you.
Closing joint credit accounts is particularly important if your divorce has been rocky or if your ex is still experiencing a great deal of emotion. Or if you are still quite emotional about the divorce. Joint credit is an opportunity to spend ‘on’ each other. So closing joint credit also helps to draw that new line between you and your ex.
Research Local Apartment Costs
Here’s an important fact: At least one of you is going to move out of your shared home. Perhaps both of you. Whether you’re ready for the move-out stage or not, you are going to need to prepare for it either way. And part of that is knowing what your new cost of living will be. You’ll need to do some research to figure out how you’ll need to budget as a single person.
Take some time to investigate how much apartments and small rental houses cost in your area. If both you and your ex will be moving, then this information will be useful to the both of you. If you’re just researching for your own relocation, be sure to take this opportunity to move closer to work and shorten your commute. Or move closer to friends or family members for support.
Build Separate Credit
Married couples are often seen as one financial unit. Including credit score. And divorce can do a number on your personal credit for a variety of reasons. Higher taxes, legal fees, the fact that you’re down to one income instead of two. You may individually take on some debt you once shared with your ex. You may need to put some expenses on credit.
So right now, before the divorce wreaks financial havoc on your credit score, it’s time to start building up your personal credit. Put effort into paying off your debts and paying credit card bills on time. Go through the whole process of researching old debts to have them expunged or renegotiating payments to get you payment plan on track.
By doing credit score maintenance and repair procedures early, you can help reduce the negative impact of divorce on your credit score and put yourself in a better financial position to succeed after the divorce.
Start Paying the Bills
For our final tip, the divorce mediators at Split Simple highly advise that you get a handle on your bills. If you have been the one handling payments for your marriage, then you’re already in a good place. But if your partner has been handling the bills, you might be just a little out of touch and out of practice. But you’ll need to be smooth and ready for bill payment when you’re building an independent life in your own place.
So take over the bills, or at least become aware of them. Check your billing histories, make sure you can access all billpay accounts, and talk to your spouse about splitting billpay responsibilities so that you both get the perspective and practice you need to prepare for separate lives.
Contact a Divorce Mediator in Denver Today!
In an uncontested divorce in Denver, your finances are often turned completely upside-down. What was financial security with two people can seem like a mess when trying to piece together two separate lives. But you can do it. And with these pre-divorce financial prep steps, you will be much more ready to take on the world and your new life when the divorce is finally settled. For more insights into how to achieve the ideal uncontested divorce in Denver with a smooth transition to independent life, contact
contact Split Simple today. Here at Split Simple, making divorce easy is what we do best.
1624 Market Street #202
Denver, CO 80202