Once you finalize your divorce, it is too late to wish you had fought harder for a better financial deal.
Therefore, you must ensure you completely understand your financial needs before entering divorce negotiations.
Make a post-divorce budget
Here are some of the outgoings you need to calculate. Remember many of these will increase after your divorce because you are no longer splitting the costs with your spouse:
- Housing: There is no point in fighting to keep the family house if you will not be able to keep up with the mortgage and running costs. Downsizing is often more realistic.
- Children’s education: Some divorcing parents create a trust fund to cover educational costs. Putting money aside now may be easier than scraping it together in the future.
- Health care: If one of you is insured under the other’s employer-sponsored health care plan, you must determine how much it will cost to get your own. The older you are, or the more pre-existing conditions you have, the more expensive this could be. You also need to decide how to cover health and dental care for your children and what will happen if they have emergency costs.
- Retirement: one spouse may be entitled to a portion of the other’s retirement funds. Divorce may also affect one spouse’s ability to claim benefits in later life. Both of you may need to re-evaluate how you will fund your retirement.
Consider getting help to ensure your understanding of financial issues in divorce is correct and that you get what you are entitled to.