Getting A Divorce? Avoid These 4 Bad Financial Mistakes
Staying in the marriage is no longer a possibility, but without some divorce financial planning and research, it is just as horrible and potentially dangerous. At least, to your wallet. Divorce takes a toll emotionally on every party, including children, (if they’re even involved) but don’t let the emotional trauma cloud your judgement and make any of these 4 bad divorce financial planning mistakes.
Your emotions can't decide
Heed this divorce advice. You may be angry or emotionally drained enough to want to keep that summer house for yourself and move over there, but be objective about the situation and see if you can afford it, the taxes that come with it, and if moving is something you would still want 3 years from now. Analyze the impact your decisions will have in the future. Divorce financial planning starts with your brain, not your heart.
Have liquid assets post split
Yes, you may have a list of assets post-divorce, but after you split, you will need to pay for expenses, move around and buy furniture and basically live life. Don’t settle for depreciative assets such as cars, real estate or retirement accounts without including some good old cash.
Insurance is key
Focus on negotiating the terms and amount of spousal support, should there be any, and child support. After securing that income, find life insurance policies that protect the whole family, divorced or not. There may already be one in place that needs to be updated.
Acceptance is key
Your standard of living is about to change, so reality hits and you need to be prepared to make the sacrifice to live a happier life. You may have to rough it out for a while, until you get back on track. Be proactive and embrace change, as only through a positive outlook you will encounter millions of new opportunities you missed living a miserable but financially secure life. Find a career, a job, or a hobby that allows you enjoy the new path you’ve chosen. After all, it’s only temporary.