Separation can be a tough road; it’s an emotional rollercoaster, and it can feel like you’re losing a lot. It may affect life as you’re used to and require many uncomfortable changes. While recent datasuggests that the divorce rate might be shifting, the American Psychological Association says that roughly 40-50% of first marriages and even more second marriages end in a split. Fortunately, there are some effective moves you can make to safeguard your assets and make this challenging journey a bit easier. Here are eight smart ways to do just that.
Keeping things friendly during a separation might seem impossible in most circumstances, yet the less drama in your separation or divorce, the more you save. Those legal bills can skyrocket if things get heated. If you and your former partner can work things out through negotiation instead of fighting it out in court, you’re looking at potential savings in the tens of thousands. Therefore, try and keep it amicable and put those hard-earned dollars back in your pocket.
You don't want to get left in the dark regarding family finances. That is even more so when you’re going through separation. It’s pretty common for one spouse to take the reins when it comes to money matters, leaving the other uninformed. But here’s the deal - if you’re not in the know, you might be missing the whole financial picture, and that’s a recipe for trouble and unpleasant surprises. You want to be in the loop so you know the situation with your spouse’s financial situation, especially in areas that could have implications for you.
Take an inventory of all your marital properties. Take some pictures of all the stuff in your house that belongs to the both of you, from the living room to the garage and even the dusty storage space. It’s essential to have a clear inventory of all the assets that must be divided during the split. By the way, if you have a home together and you’re both not on the same page about what to do with it, like one wants to sell while the other wants to keep it, or you’re stuck on how to divide it, you might want to look into something called a ‘partition action.’ But what is a partition action?It’s a legal action that can help sort out property ownership and usage issues. Creating a proper inventory is one of your early steps to protecting what’s rightfully yours during this separation, so feel free to consider this. It is time to tackle a financial strategy that can ease the separation process. If you have joint accounts, consider opening an account in your name. No need for secrecy here. It’s best to chat upfront with your spouse about this move. That way, you can work together on managing expenses and those automatic payments. The goal is to ensure all the bills get paid while avoiding extra funds in the joint account for anyone to dip into.
When it comes to joint loans, you have to watch your back. Even if your former spouse agrees to handle payments as part of your divorce agreement, the lender still sees both of you as liable. To protect yourself, give your lender a heads-up and let them know the situation. If you’re in the clear and don’t need that credit anymore, ask if you can cut ties with the joint liability. But if the lender is reluctant to let you off the hook, consider asking them to freeze the account, especially if you don't plan to use it. You can also request that they notify you if your former spouse falls behind on payments. That way, you’re in the know and can take the right steps if things go south.
It’s time to round up all the relevant paperwork. Get your hands on copies of all those joint accounts and tax returns. Your divorce attorney is going to want those. And while you’re at it, grab the statements for all your accounts, whether it’s the bank, retirement savings, car loans, or credit cards. This pile of paperwork will give you the big picture of what’s on the table to split with your former partner. Plus, it’ll greatly help your attorney when they’re working on negotiations and settlements.
When you’re going through a divorce and need to safeguard your assets, it’s time to have a heart-to-heart with an experienced divorce attorney. They’re your go-to guides for all the nitty-gritty details on how to keep what’s rightfully yours. With their trusted legal guidance, you’ll be all set to protect your assets and navigate the divorce process without many problems.
Planning ahead of time with agreements like a prenupor even a cohabitation agreement, can save you a lot of headache. The way the law sorts out your stuff if your relationship hits a rough patch might not match what you think is fair. So, before you move in together or say ‘I do,’ consider a prenup or a cohabitation agreement. With one of these in place, you and your partner can set the rules for how assets are divided if things go south, and both of you will be glad for the peace of mind you’ll enjoy even if you live happily ever after.
A divorce can be overwhelming, causing you to overlook crucial aspects of the process, including your finances. However, when dealing with your finances and assets during a separation, don't let anything slip through the cracks amid all the chaos and disagreements - setting yourself up for a fresh start in life after the split is critical. So, take a deep breath, get those assets in order, and here’s to a brighter future.