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Getting your finances on track for divorce

On Behalf of | Jul 20, 2021 | Uncategorized

Finances should not hold you back from ending an unhappy marriage. However, the reality of daily living can understandably seem overwhelming when you are not sure what your money might look like after a divorce. Instead of putting off filing for divorce, you can take proactive steps to protect yourself financially in the future.

One of the biggest concerns you may have is about how you will divide your marital property. New Jersey is an equitable division state, which means that you will not necessarily divide your assets 50/50. Instead, you can expect to divide your property in a way that is most fair and not necessarily even.

Get your financial information in order

One of the first steps is to gather as much information as possible about your marital assets. These are the assets you acquired during marriage and that both you and your spouse now jointly own. Depending on how long you have been married, you could have quite a few marital assets. Here are just a few examples of marital assets for which you will need to gather related financial information:

  • The marital home
  • Vehicles
  • Financial accounts, including retirement savings
  • Pension plans

You might not realize that much of your debt is likely also jointly owned. This means that, even if your ex was the only one who ran up a credit card bill, you might also be responsible for paying it back. When you make your list of assets, be sure to include all debts as well. You can access your credit report to look for any debts that you might not be aware of.

What does your income look like?

You will also need to determine how much you and your spouse earn. This is an important step when dealing with things like child support or alimony. Depending on the situation, figuring out your income can be fairly straightforward. If you and your spouse are salary or hourly workers, you may really only need recent pay stubs and a copy of your most recent tax return.

Things get a little more complicated when it comes to self-employment. If your soon-to-be ex is self-employed, copies of your bank statements or his or her financial business statements will be helpful. Figuring out his or her exact income will still be tricky, so it is best to gather what information you can.

Budget for the future

Are you going from two incomes to just one? Will you partially rely on child support or need to account for alimony payments coming out of your paycheck? These are all essential questions to ask yourself. One of the best ways to prepare for your financial future after divorce is to be honest with yourself about your new income and expenses, and to create a realistic budget with that in mind.

You should also protect yourself during divorce, which may include establishing new lines of credit or your own bank account. You have to be cautious of your financial decisions during divorce though, as they can sometimes impact the process. To keep from making avoidable mistakes, it is often helpful to first learn as much as possible about New Jersey family law.