What's Keeping You Up at Night with Your MN Divorce?Aug 31, 2023
Are you staying up at night, stressing about finances, who will keep the house, how you’ll make your house or car payments? Divorce has so many aspects that can put you in a place of overwhelm, which is why I bring on experts in so many different areas to the podcast. This week, I had Leah Hadley, the founder and CEO of Great Lakes Divorce Financial Solutions. Listen here! Leah helps women navigate their finances around divorce, and has some great tips on how to prepare your finances before, during, and after the divorce.
Before the divorce process has even started is a great time to become aware of your finances. Whether you have decided to proceed with a divorce, or your spouse just told you they’d like a divorce, getting conscious of what your money situation looks like is key for peace of mind. This is especially crucial if your spouse is the one that manages the money. Here are some tangible things you can do to be better prepared:
- If you have limited financial knowledge - learn about your financial situation
- Get clear on where the income is coming from, when it comes in, what the fixed expenses are, what the variable expenses are
- Create a list of your assets and liabilities
- Run a credit report - you can get one free per year per credit agency
- See if there's anything on your report that doesn’t belong there and work on removing those items
- Establish credit in your name - get a credit card in your name, use it and pay it off every month. This is important for refinancing or applying for an apartment
- Hire a financial advisor
Check out Leah’s free Divorce Checklist, which will help you stay on track and gather the information you need.
Once you have a clear understanding of your finances, the next step is to gain knowledge around your state's laws and how they manage divorce. If you and your spouse are in a good place, where you will be doing mediation and feel like you can make financial agreements equally, this can be a great area to go through together. However, there are times that divorce gets messy, so it's important to understand the laws in your state. Some things you will want a basic understanding of are:
- Spousal support.
- Which variables go into child support, then gather those materials.
- The property laws for married couples in your state.
- What is the marital estate?
Many people focus on the wrong things when they are looking at splitting up assets. While the house and investments are important, they are not the bottom line. It’s essential to focus on liquidity. Make sure that you have access to liquid savings to deal with whatever expenses come your way. If you are needing to fight in court, you will likely experience some financial strain, and need to dip into savings. Look at the short and long term implications of the assets you are keeping. For example, if staying in the family home will create a huge financial burden and cause stress for you, is it really worth it in the long run? You’ll likely be happier in a new home that you can afford, making new memories! Lastly, be aware of assets that can easily transfer to cash should you need money quickly.
As you ease into post-divorce life, you get the chance to realign your money according to your vision. This is a time to be realistic, as things have changed in your life and maybe the luxuries you once had are possible at the moment, but they can change again as you get settled. Things don’t always change for the worst, many people find themselves in a way that is truly beautiful after divorce. Start by looking at your new budget and expenses, determine if the monthly bills are serving you in the next chapter of your life. Do you need to change your living situation or would a different car better suit your needs? Is getting your nails done or your morning coffee a necessity (sometimes they are!)? Take this as an opportunity to determine your values and be intentional with your finances.
The last piece of advice Leah had for us was to have a notebook on hand, and jot down whatever is going through your mind. This allows for more headspace to look at the realities and gets any financial fear or other stressors out of your head, then you can start tackling it with less overwhelm. I hope you found this information truly helpful in preparing for divorce. I cannot recommend hiring a financial advisor enough, so check out Leah’s website. If you are seeking mediation support, please schedule a free consultation with me, I’d love to stand by your side through this life change.
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