Pre-Divorce Checklist: Getting Prepared

pre divorce checklist

Pre-Divorce Checklist

If you are considering a divorce, this pre-divorce checklist will help you understand your financial situation and help you make informed decisions about your future. The more prepared you are, the easier it will be to understand your priorities and goals as you and your spouse work through your divorce settlement. This checklist can also help you avoid common financial pitfalls in a divorce.

#1 Establish Information Boundaries

Gathering as much information as possible is critical to making informed decisions in a divorce.  Keeping that information secure and accessible is also important. Start with getting your own P.O. box and having all communications related to your divorce sent there. Make sure you communicate to any financial institutions and members of your divorce team (more about them later in this post) that all communications should be sent here and not to your home address. You should also consider setting up a new, secure email address for yourself and changing passwords on your existing email, social media and other private accounts. You don’t want your spouse cyber snooping, or worse, impersonating you.

#2 Figure out Your Priorities

The more you have a handle on your financial needs post-divorce and your desired outcome from the settlement, the more likely you are to achieve your goals.  Here are a few specific areas to think about

  • Where do you want to live?  This could range from the current family home to moving to a condo or home to relocating to another state.

  • If you have children, how do you want to raise them and coparent? Will there be any changed in where they go to school or tuition fees? How do you want to communicate the separation?

  • Who gets what assets (home, cars, banking and investment assets , etc.)?

  • What type of relationship do you want with your spouse once the divorce is finalized?

#3 Collect and Inventory Important Financial Documents

Having a complete picture of you and your spouse’s assets and liabilities is critical to a fair and informed divorce agreement. And while  you can hope your spouse will handle things maturely, you shouldn’t count on it. Make sure you have copies of all important financial documents and access to all account information, including account login information, for the following:

  • Bank and investment account statements

  • Tax returns for the past 3-5 years

  • Recent pay stubs for you and your spouse

  • Retirement account and pension statements

  • Social security estimates for you and  your spouse

  • Any prenuptial agreements

  • Stock options

  • Mortgages and property tax documents

  • Recent credit card statements and any other loans

  • Recent credit reports for you and your spouse

  • Copies of the last 12 months of bills for recurring household expenses (utilities, school tuition, kids activities)

  • Insurance Policies (Life, Home, Auto, Health, Disability, Umbrella)

  • An inventory and, where appropriate, appraisals of all personal property acquired during the marriage

  • Any employment contracts and other employer provided benefits for you and your spouse

  • An accounting of any personal property you owned prior to the marriage

  • Wills, trusts, power of attorney and any medical directives

  • An inventory of the contents of any safety deposit boxes

#4 Open Your Own Financial Accounts and Start Saving Money

If you don’t already have a bank account in your own name at a separate institution from any shared accounts, open one immediately and begin funding it. You want to ensure you have funds to pay your living expenses and your support team while the divorce is finalized. Take stock of your current living expenses and how they will differ once you and your partner split so you can budget and plan accordingly. State law will determine how much you can remove from joint accounts, but you can consider shifting direct deposits from your paycheck into the new account.

Now is also the time to get a handle on your credit score and any debt. If you don’t have a credit card in your name alone, apply for one and make small regular charges to it.  Just make sure you pay in full each month. Pay down any existing debt as much as you can. Even if your divorce settlement states that your ex will be responsible for debt, creditors may come after you.

#5 Start Building Your Team

Divorce is complicated and the consequences of overlooking the impact of certain decisions can have lifelong impact. By understanding your needs and priorities, you’ll know who should be on your divorce team (the experts you’ll be working with throughout the process of distributing marital assets and developing a divorce agreement). At a minimum, you should probably have a lawyer and a financial advisor to guide you through the process, but exactly which pros you should have on your team will depend on your unique situation and what type of divorce is best for you. For example, if you are looking to have an amicable relationship with your former spouse, hiring the lawyer who describes themselves as a “pit bull” might not be the right fit. You might also want to consider a financial advisor who specializes in divorce cases, such as someone with the Chartered Divorce Financial Analyst (CDFA) designation. You can find a list of CDFA advisors herefind a list of CDFA advisors here.

#6 Secure Irreplaceable Personal Items

It’s better to be safe than sorry when it comes to irreplaceable personal items, such as photographs and other mementos. Collect and move them to a secure location before beginning the divorce proceedings, particularly if you are the one moving out of your shared residence.

#7 Update Your Will, Medical Directives and Beneficiaries

Even though you won’t be able to completely remove your spouse from your will until the divorce is finalized, you may want to consider removing them to the extent state law allows now. There will be a little bit of extra cost in this, but if kids are involved, it ensures most of your money will go to them and not your former spouse if something were to happen to you during the divorce proceedings. In a similar vein, you may not want your soon to be former spouse to have the ability to make life and death decisions for you. Check out our Divorce Checklist to learn about changing the designated beneficiaries for insurance policies, and investment or retirement accounts.

#8 Be Good to Yourself

There’s a lot to think about and do when deciding to end your marriage (our pre-divorce checklist isn’t small), but getting organized can help alleviate some of the stress and ensure you don’t overlook critical items that can impact your future.

Preparation is key to reducing the significant stress and costs, both monetary and emotional, a divorce entails. But self care is paramount. Leaning on friends when you need to and taking care of both mind and body will help you get through the ups and downs of going through a divorce.