Sunday, December 22, 2013

My 6 Tips to Financially Prepare for Divorce

In a fair world, the price you pay for divorce is your heartache.
In the real world, the price is heartache and cold, hard cash. 

It’s been about a year now since Max and I started separating our finances, but we didn’t fully disentangle until our condo sold in the beginning of September. It’s been three and a half months of living fully on my own financially. Since it’s the season of spending, here are my 6 tips for how to financially prepare for divorce.

Disclaimers: I’m the furthest thing from a financial planner, so these are tips I figured out or gathered from people who seemed to know what they were talking about. My financial situation with my ex-husband was fairly simple. We had a mortgage on our condo and otherwise had no debt. We don’t have children. There was no history of lying or deception. 

Six ways I financially prepared for my divorce:

  1. Keep a joint checking as long as necessary. Max and I lived together for six months after we divorced. There was enough emotional stress, so we did not want to nickel and dime each other. To keep things simple and civilized, with the help of our mediators, we deposited equal amounts into a joint checking account to pay the basic living expenses like the mortgage and utilities. We also paid our legal fees out of this joint checking account.
  2. Separate your savings as soon as possible. Savings accounts are about planning for the future. You and your ex don’t have a future anymore, so separate that money – or start a new savings account in just your name – so you can actively start preparing for your new goals. Also, separating the savings gives you a realistic look at what you have to work with.
  3. Stay together on some services to save money. I looked into separating our auto insurance and cell phones, but it turned out it would cost us both a fair bit of extra money as two single accounts. So, we stayed on joint plans until the condo sold.
    (Speaking of cell phones, be ready to be totally irritated by separating your cell phone plans. I swear, it was easier to get divorced than it was to separate our Verizon accounts! I might’ve cried on the phone with a Verizon manager.)
  4. Take a hard look at your current spending priorities. How will your habits change when it’s just you? Where can you cut corners? What will you absolutely not cut out? I knew I needed enough padding in my account so I could keep my gym membership. There is a nice-ish gym I could join for half the price, but nope -- my current gym is a priority, so I had to make it work. Bye bye, cable and a house cleaning service! Those cuts saved me about $150 a month, which I use to mentally justify my gym membership.
  5. Figure out what your new expenses will be and starting living according to that figure immediately. My expected cost for rent was going to be about $300 more than my half of the condo mortgage payment, so I started putting $300 into my savings account every month to get used to living on that new amount. (Bonus: my savings account got an extra $1,800 while I waited six months for our condo to sell.)
  6. Don’t just get tips from bloggers like me – talk to a professional. Did you know that there are financial planners who actually specialize in divorce preparation? I didn't! Make an appointment with some kind of financial planner before the divorce is final, and then make another one for after the dust settles. I have a second appointment the first week of January to take a look at my retirement savings in particular.

These are my favorite tips that helped make my financial life suck a little less during the divorce whirlwind. In terms of your finances, what did you do leading up to your divorce and living separately? What is your best tip or resource?

See also: 10 Things You Need to Do When You Get Divorced; Financial Advice for Divorce.
Super Sunday Sync


  1. I wanted to follow your blog but I don't see a Join my site button. If you can link me that would be great in the mean time here is some of my links. I hope you can follow me & my blog (:

  2. You had trouble with Verizon? I walked into a store at our mall and said "I'm getting divorced and need to get on my own account and away from my ex." Perhaps I got lucky because the gal that helped me out told me she knew exactly what I meant as she had been through it, too.
    The day after he asked for a divorce I printed out my past 6 months of my pay stubs, a copy of our monthly budget spreadsheet, started browsing apartment costs and then I calculated numbers. I knew I'd have to find my own place (eventually) and I needed to be aware of what I would be able to afford. I was upset the day before but the day after, for some reason, the tidal wave of emotions rolled into anger fueled determination and drive.
    My advice...
    *If family and friends offer their help you should greatly consider taking their offer. You're going to be more tired and drained than you've ever been and you're going to need their help more than you might realize. My oldest brother allowed me to store things at his house, my parents let me put some furniture in their basement for a year and my oldest sister allowed me to move in with her for nearly a year (I paid half of the rent but she let me pay as much as I could when I could).
    *Have a joint account for joint bills until you are totally split BUT have your own accounts in your own names (and only your names) right away if you don't already. Pay off then close all joint credit accounts if you can. I've been separated 18 months and divorced for about 6 months but finally a few weeks ago we got our joint account(s) closed.

    As much as it sucks you have to have very blunt discussions about finances with your ex until you're leading your own separate lives. Many times those conversations required tongue-biting, restraint and walking away for a few minutes to cool down before saying not nice things. I'm much more financially conservative than my ex and it feels good to not have to see his poor spending habits (not that he bought big ticket items but consecutive small charges add up like going out for lunch all the time).

  3. Great tips for handling the financial aspects of a divorce

  4. Thanks Veronica!

  5. "These are my favorite tips that helped make my financial life suck a little less during the divorce whirlwind." That's the perfect way to put it too. Divorce is hard on finances, no way around it!! Nice of you to put up the tips!! Thank you for linking to Super Sunday Sync! Merry Christmas!!

  6. Kristi - Finding NineeDecember 23, 2013 at 8:27 PM

    My ex and I lived together until our house sold as well. These are great tips because you're right - there's so much financial hardship over a divorce. It took me a long time to get it all sorted.

  7. Kat, these are all very practical tips from someone who has obviously been there! You have a great attitude that will benefit many readers. Best wishes to you.

  8. Great tips -- I totally agree. And I know what you mean about it feeling good to be free of spending you simply wouldn't do yourself. My ex would go to a high-end grocery store for dinner and literally spending $40. Drove me bonkers, so I was quite happy when that $40 came from "his money."

  9. Thanks Rosey, Have a great Christmas!

  10. I know, I'm still figuring myself out!