We know you have heard the horror stories of couples and families going broke during a divorce. Couples who have saved for five, ten, or even twenty years only to throw money out the window.  This often happens out of spite or when an individual attempts to keep his or her former spouse from getting anything out of the relationship financially.

Even couples who have no plan in doing so may find their savings depleted when they choose the wrong attorney that doesn’t have a client’s best financial interests in mind.  While this isn’t always the case, we would hate to see this happen to you and we have some suggestions to help you work through your divorce and avoid any potential financial complications.

In this article, we will discuss how both sides can work together to keep financial loss under control and a positive divorce the main objective.

business meeting
Agree to be Open About Money

This is the most important part of the process. Know that nothing will work as planned if you and your soon to be ex co not agree to work together to not waste money in the divorce. Hiding money from one another through secret accounts will only end badly for both individuals.

If you have children together, make sure to agree on the importance of both spouses being financially stable after the divorce. If not, the children may suffer.

Make Sure Children Come First

Children of any divorce will have enough stress in their lives without worrying about money. It is important that both of you don’t skip any money spending steps when it comes to what children are used to. Make sure you agree on:

  • How any school costs will be taken care of
  • After school programs and sports continue as they always have and how you will pay for them.
  • Money for field trips and vacations are there for them.
  • That car you were planning to buy them on their 17th birthday still gets delivered.
  • Lunch and spending money continue to flow as it always did.

 

This can help teach both parties that they can work together, not only when the children are involved, but also between the two parties.

 

child and mother
Avoid Large Purchases

There may be a temptation to purchase that expensive car or boat that your spouse never allowed before. Agree at the onset that neither party will take on any expensive items that can affect everyone’s finances.

Once a purchase of this type happens, it can throw the divorce into turmoil, and any negotiations from that point on may be deterred. The agreement will also help with not making any purchases from spontaneous decisions based on loneliness or depression.

Set A Budget Together

It may sound strange, but there will be extra expenses to cover until the divorce is final. If, during a separation, one of the spouses decides to live somewhere else will add extra cost to both parties.

By sitting down and working out a budget together wherever possible, you will not put one of the parties in a position of feeling as if they must ask for money. This will reduce stress and resentment during the divorce. By being amicable and working together, the overall divorce will show you are willing to negotiate and make things go much more smoothly.

Continue To Pay All Bills

It is easy to get caught up in not paying for things you did not agree with during the marriage. So many divorces end with one or both persons creating poor credit for themselves. Losing your credit rating is one of the top complaints after a divorce. It can take years to recover financially. This does not have to be the case. Remember that both of you are responsible for all of the bills until the court orders otherwise.

Work together during the budget-making process to determine who and when the bills will be paid to alleviate confusion and mistakes. If you are the one paying, be sure, and share any receipts with the other person to make sure everything is open and reduce stress.

Do Not Close Accounts

If any of the parties have investment or banking accounts, don’t close them and remove any money without making an agreement together. This can be frustrating and appear untrustworthy when these types of decisions are made without the other knowing about them. It can appear that way to a judge during the divorce also and cause issues during negotiations.

Use Technology to Help Work Together

Getting divorced today is certainly different than in years past. There are applications available like DComply, that can assist both parties with finances, making payments together, and settling disputes that may arise. Using technology to work for the both of you can help keep the peace and reduce the time needed to be spent together making decisions.

In the end, you and your soon to be ex do not need to go broke during a divorce. By working together, putting children at the front of the line, and making sure neither incur debt during the divorce, you both can be financially sound afterward.

 

 

man in pink shirt
Marco is a divorced father that ended his marriage in 2005. From 2011-2016, Marco and his ex-wife relitigated his divorce over “phantom expenses” that his former claimed in order to dramatically increase child support. The experience taught him that family courts are ill equipped to adjudicate these decisions. Divorced parents bring their own stories to court and judges don’t have the time or tools to sort through the financial transaction detail to make completely fact-based decisions. Marco realized that there is no reason that there shouldn’t be a digital fingerprint of two co-parents’ financial relationship. This compelled him to lean into his experience leading sales operations teams and selling financial accounting software to design DComply to be that single source of financial truth post-divorce. In addition to founding DComply with his wife Giovanna, Marco is a Regional Vice President with Oracle and has a 20+ years of experience in tech sales, sales operations and leadership. He has a BA from Boston University and his MBA from the Johnson School at Cornell University.

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P.S. Want more tools and resources to stay positive during a divorce? Download my Free Divorce Survive & Thrive Kit below!

 

 

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DISCLAIMER: The commentary, advice, and opinions from Gabrielle Hartley are for informational purposes only and not for the purpose of providing legal advice or mental health services. You should contact an attorney and/or mental health professional in your state to obtain advice with respect to any particular issue or problem. 

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