All Arizona residents who are either contemplating a divorce or have already begun the process need to make sure they have fully analyzed all of their finances in order to navigate the divorce process successfully. It is recommended, especially in a high asset or high income marriage, to meet with a financial advisor either prior to or at least during the divorce process.
Emotions frequently run high during the divorce process, and that can lead to bad decision making when it comes to finances. A prenuptial agreement can be utilized to limit the impact of a divorce on a person’s financial well-being by protecting some or all of that person’s individual assets attained prior to entering a marriage. A postnuptial agreement, which is entered into after the marriage takes place, is another option for dividing assets in the event that a divorce occurs at some future date. These agreements can significantly reduce the financial and emotional costs of a divorce by doing away with the added cost of litigation over the division of assets in court.
If a divorce appears to be inevitable, it is important to collect all records of bank accounts, previous tax returns, monthly bills and pension plans. These documents must all be examined closely prior to the divorce process. Also, it is a very good idea to have a budget and stick closely to it a person’s standard of living is likely to change following a divorce. An emergency savings account can also be set up for anyone undergoing a divorce.
Source: USA Today, “Before divorce, prepare yourself financially,” Hadley Malcolm, Sept. 14, 2012