Divorce can often have an overwhelming impact on finances. Unfortunately, the procedure frequently places both parties in a vulnerable financial situation. This increases the necessity for persons going through divorce to be aware of essential divorce transition wealth management strategies during this transitional period.
Review existing agreements and papers
Prior to filing for divorce, you should carefully review any pre-existing financial agreements and papers with your lawyer, including any prenuptial or postnuptial contracts and joint accounts. Make sure these documents are updated based on current laws and regulations, so that you can ensure a fair division of assets upon settlement. If there was no prior agreement, then the division of assets may require consent from both parties and could be fairly complicated depending on each individual’s financial status at the time of separation.
Reassess your sources of income
You should also think about how divorce may influence your income sources and what you need to do to maintain a steady cash flow during this time. Reevaluate all sources of income, including investments, real estate holdings, and even family businesses if they were included in the marital estate during the marriage. It might be beneficial to talk this through with a financial advisor.
Understand all payment structures and debt obligations
Another important aspect of managing finances after divorce is to review all payment structures and debt obligations – such as credit cards, loans, mortgages etc. – that were shared between the two individuals when married. If applicable, it will be essential to properly divide these debts amongst yourselves in order to avoid any legal or financial trouble post-divorce.
Set a budget
Additionally, it is often beneficial to create a budget for yourself that accounts for all of your expenses and income sources. This can be an invaluable tool for monitoring your financial success as you go through the divorce process. Consider creating an emergency fund as well, which will act as a safety net in case of any unforeseen expenses.
Work with a financial advisor
Finally, it’s critical to keep in mind that each person’s financial condition is distinct from the others. Talking to an experienced financial advisor who can give you guidance based on your specific requirements can be helpful. A financial advisor can provide tailored advice specific to your personal needs and help ensure that you are set up for long-term financial success
The impact of divorce on one’s finances can be significant. But with the right divorce transition wealth management strategies, you can ensure that you come out of this process in a stronger financial position.
If you’d like to be well-equipped to navigate your finances during divorce and you wish to set yourself up for long-term financial security, get in touch with us!
At Gainspoletti Financial Services, we provide comprehensive financial planning and wealth management strategies to bring your vision into sharper focus so you can enjoy the lifestyle you want and deserve. We believe that our clients deserve exemplary service, and we are committed to delivering.
Schedule a call to work with our financial advisors!
The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing materials accurate or complete. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Any opinions are those of Gainspoletti Financial Services and not necessarily those of Raymond James. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Every investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Financial and investment planning inherently involve potential tax and legal implications, with which we are generally familiar. We do not, however, practice as lawyers or CPAs and cannot give specific legal or tax advice. You should always consult with your tax advisor, or your attorney, when making complicated legal or tax decisions, however, we’re glad to work with your tax or legal professional to help you meet your financial goals. Raymond James financial advisors do not render advice on tax or legal matters.