I'm Getting a Divorce. Now What?

One of the biggest mistakes is making emotional decisions rather than financial and strategic ones; easier said than one, yes.  Many women underestimate their financial needs post-divorce, fail to account for long-term expenses, or settle too quickly without understanding their rights. Not hiring the right professionals—such as a CDFA, mediator, or attorney—can also lead to costly mistakes. Avoid hiding assets, ignoring tax implications, or assuming your ex will “do the right thing.” Instead, focus on securing a fair settlement, planning for financial independence, and ensuring you have a clear picture of your post-divorce life before finalizing any agreements.

Divorce is a major transition for children, so keeping their emotional and financial well-being in focus is crucial. Maintain open, age-appropriate conversations with them and reassure them that they are loved. Minimize conflict in front of them, and consider co-parenting counseling if needed. Financially, ensure child support agreements cover necessary expenses, including education, healthcare, and extracurricular activities. A detailed parenting plan can also help provide structure. 

Divorce can significantly impact your financial situation, as income that provided for one household will now provide for two, so preparation is key. Start by gathering financial documents, including bank statements, tax returns, and debt records. Assess your income, expenses, assets, and liabilities to understand your financial standing. Consider working with a Certified Divorce Financial Analyst (CDFA) to help you create a realistic post-divorce budget. Understanding how property division, alimony, and child support work in your state can also help you plan. 

Avoid making major financial decisions before consulting a professional, and focus on securing your financial future rather than just getting through the process.

Gathering the right financial documents is crucial for a smooth divorce process. Here's a checklist of essential documents:

• Tax returns (last 3-5 years)
• Pay stubs and income statements
• Bank statements (checking, savings, CDs)
• Investment account statements
• Retirement account statements (401(k)s, IRAs)
• Mortgage statements and property deeds
• Credit card statements
• Vehicle titles and loan information
• Insurance policies (life, health, auto, home)

These documents provide a comprehensive picture of your financial situation, helping to ensure fair asset division and support calculations; your case may require more or less items.  Having these ready can also save time and reduce legal costs.

Budgeting for divorce involves anticipating various costs and managing your finances carefully:

• Legal fees: Research average attorney costs in your area
• Expert fees: Consider costs for financial analysts, appraisers, or therapists
• Living expenses: Plan for separate housing and daily expenses
• Emergency fund: Set aside money for unexpected costs

Tips for managing finances during divorce:

• Create a detailed budget of current expenses
• Open individual bank accounts
• Monitor your credit report
• Avoid major purchases or financial decisions
• Consider working with a financial planner to create a realistic budget

When dividing assets, consider:

• Current value vs. future value: Some assets may appreciate or depreciate
• Tax implications: Certain assets may have tax consequences when sold or transferred
• Liquidity: Consider how easily assets can be converted to cash
• Long-term financial needs: Think about your post-divorce lifestyle and financial goals
• Emotional attachment vs. financial benefit: Weigh the practical value against sentimental value
• Hidden assets: Ensure all marital assets are disclosed and accounted for

Working with a Certified Divorce Financial Analyst (CDFA) can help you understand the long-term implications of different asset division scenarios.

Strategies for post-divorce financial stability include:

• Create a comprehensive financial plan: Set short-term and long-term financial goals
• Build an emergency fund: Aim for 3-6 months of living expenses
• Review and adjust your budget regularly
• Invest wisely: Consider working with a financial advisor to create an investment strategy
• Enhance your earning potential: Consider additional education or career development
• Protect yourself with appropriate insurance coverage
• Plan for retirement: Maximize contributions to retirement accounts
• Establish good credit in your own name

Remember, financial stability is a journey. Start with small steps and seek professional guidance when needed.

A Certified Divorce Financial Analyst® (CDFA®) is a financial professional specializing in the unique financial challenges of divorce. A CDFA® helps you understand how decisions about assets, debts, and support will impact your financial future, ensuring you make informed choices. From analyzing settlement proposals to forecasting long-term financial outcomes, a CDFA® provides clarity and confidence during an emotional time. Whether you’re navigating negotiations, deciding whether to keep the house, or planning for post-divorce stability, I offer expert guidance tailored to your needs. My goal is to empower you with knowledge so you can move forward with financial security and peace of mind.

Deciding whether to keep the home in your divorce is both an emotional and financial decision. While it holds special memories, it's essential to consider the long-term costs—mortgage, taxes, maintenance, and overall affordability. Will keeping the home support your financial stability and future goals? It’s helpful to evaluate your full financial picture before deciding. As a divorce financial planner, I can help you weigh the pros and cons so you make a choice that aligns with your future plans and well-being. If you'd like to discuss your options, I’d be happy to help!