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Protecting your finances in a divorce

On Behalf of | Nov 28, 2023 | Divorce

You might be emotionally ready for a divorce, but not financially ready. This is a common fear of many divorcing Virgnia couples, since divorce involves the splitting of your marital property and adjusting to living on one income.

The fear of losing financial stability can even cause some couples to stay married when divorce would be better for both. When you know you are heading for divorce, there are several steps you can take in preparation to help you remain financially stable post-divorce.

Educate yourself on costs and fees

Divorce is going to cost you money. There is often no way around that. Before your divorce gets filed, find out the cost of everything involved in the divorce process in your local court. There are typically costs and fees during every step of the divorce process.

Although every divorce is different, one general rule for almost any divorce is that the longer it drags on, the more money you will spend. It is easy to get stuck on various issues, both major and minor, but take a step back and look at the big picture. Sometimes you will find that compromising will save you money in the long run.

Mediation can save you money

If you are having trouble with this, consider alternative dispute resolution, such as mediation, instead of going to court. Mediation is usually cheaper and quicker than courtroom litigation. You have a better chance of being happy with the ultimate outcome as well, since you have a say in it, rather than leaving it up to a judge to decide.

Obtain guidance and advice from financial and tax professionals before finalizing your divorce. Your property division settlement may look fair on paper, but there could be tax consequences or penalties you were not aware of. Your final settlement should consider any of these long-term financial implications.

Making a fresh start

It is a good idea to open new bank accounts after you separate from your spouse. Any money you put into these accounts is typically separate property that will not need to be split in the divorce.

You will likely need to adjust to a new financial situation after your divorce, but tips can help make the transition as smooth as possible.