What are some steps to protect yourself during divorce?

(the no B.S. answer you should read.)

I’ll answer, but first, see what you can do to save your marriage. Divorce is the greatest destroyer of wealth. The average divorce costs $15–20K and that does not include moving out and starting over. Mine cost multiples of that.

Ever try buying plates, silverware, cleaning products, a bed, sheets, furniture, and every single other thing a home needs — all at once? Seriously, visually think of everything in your home and think about buying it again.

The cost is astronomical and don’t forget rent with 2 months down all at the same time as payments you might have to start making immediately after the divorce (child support, alimony, childcare, health insurance, after school activities, camp, etc.)

You may end up losing your house (either to your ex or to your lawyer- to pay his fees), you could lose half of all your money, investments and retirement accounts, the pension you aren’t even collecting yet and more.

This is why so many people live like poor college students after they divorce. You won’t believe how you are so much financially worse off than any other time in your life. You will be miserable about having to completely start over from scratch as all those around you continue to progress in life.

A little introspective analysis plus time invested in both your relationship and yourself can equal a transformed marriage. Consider it.

If You Must Exit The Marriage:

The first thing you must do is gather information- before you go. Get all account numbers and passwords to anything you both have- either jointly or individually. You’ll be glad you have this information now before you no longer have access or it suddenly disappears.

Trying to get information during a divorce might be as easy as asking your spouse or as difficult as having your lawyer do it through legal means. This will cost you a lot of money so be smart and gather, gather, gather.

Make copies of all your important documents:

At least the last three years income tax returns, 401K’s, IRAs, All Bank Account numbers and balances, All Credit Card Account numbers and balances, All Insurance Policies including Home, Auto and Life, Mortgage, State/Local Tax Info, Living Expense Receipts (if you don’t have living expense receipts — make a reasonable list of all monthly living expenses), Investments, Stock Options, Deferred Compensation Information (if it applies), Implied Benefits (if it applies).

While you’re making copies, copy receipts of anything you’ve ever bought, your Will, your Computer’s Hard Drive, Photographs, Phone Numbers and Addresses, Birth Dates of anyone you guys ever knew. Prescriptions.

Your spouse’s Social Security Number, Driver’s License, Passport. You got kids? Get their birth certificates copied. Their Social Security numbers and passports. Their doctors’ information. School contact numbers and information. Their friend's information. Anything you can think of.

Learn all on-line passwords to bank accounts, credit cards, on-line auto- pay bills.

It is also helpful to know your individual and joint credit scores.

Not understanding your financial information immediately puts you in a weak position. It also means your lawyer will have to compile and calculate everything and then fill out your Statement of Net Worth with you - which is used to negotiate your settlement. This equals MANY billable hours and we all know what that means.

Photograph the contents of your home. This can help prove things existed should they suddenly go missing.

You would be surprised how much in the fog so many people are. If you aren’t the financial half of your marriage, having the information before you are divorced will help you tremendously.

Know all of your joint and single finances or at least have possession of the information. When it comes to your lawyer’s bill, it’s the Holy Grail of savings.

Next, get a matrimonial lawyer that practices in your state. Do not use a friend that is a lawyer in real estate, for example, just because you think they’ll know what to do or that they may give you a deal.

You would never go to a foot surgeon to get a heart transplant simply because they are both doctors. So get an attorney that specializes in matrimonial law.

NEVER involve your kids. I have a friend going through a divorce whose spouse is using their child as leverage. The child is traumatized, anxious, cries all the time, and will be scarred for life.

This is so wrong I hope your stomach turns as mine does just thinking about it.

You might hate each other with venom, but agree on one thing, never involve the kids and never speak poorly of each other to your children! You simply must follow this rule.

Attacking each other’s character leads to the other side attacking you and both of you defending against the latest attack.

The winner? Your divorce attorneys win and your bank account loses.

Let’s continue. You are in the legal negotiation of your life. Make no mistake that what you eventually sign off on will legally rule your life for years.

Immediately consult with your lawyer about how monies should be handled. What should you do with your joint and personal bank accounts? Where should your paycheck go to?

Understand that each divorce case has it’s own set of unique circumstances, which is why you hired a lawyer to guide you.

Your lawyer does not know everything. As I just said, each case is different. Only you know what you and your soon to be ex are capable of. As well, nobody cares as much about you as you do.

You and your lawyer are a team. They will help you with the legal portion but if you want to get out without going into debt, it’s up to you to have realistic expectations about the outcome. Nobody wins it all. It’s about compromise and managing loss.

Want To Save Money?

Get out as quick as you possibly can. This is a negotiation. Assets must be divided. Decide now what is an absolute deal breaker for you and what doesn’t matter too much.

No one gets everything they want during divorce. You’ll spend more in legal fees fighting over a dining table than it’s worth.

Talk to as many divorced people as you can. You’ll be surprised how forth coming they will be.

I’ve met strangers on trains that chewed my ear off for half an hour about how they got screwed.

Listen. Learn. Incorporate into your divorce.

Ask what mistakes they made during their divorce. Ask about the smart things they included in their divorce agreements. Ask if they could go back in time, what would they change about their divorce agreements. What were their biggest regrets during their negotiations?

Knowing what they know now, how could they have minimized the legal costs they were faced with?

Treat your divorce like a business negotiation. Both sides have to feel as if they have won.

Control your emotions, take only what you must have, get out as quick as you can and ALWAYS consider how what you are about to sign will affect you in 5, 10 or 15 years.

Don’t sign on the dotted line just to get out. I said it before and I’ll say it again. This legal document you sign will affect your life for years.

Be smart and surround yourself with the best legal team you can afford.

Please like and share if this was helpful. It would mean a lot. Thanks!

For more from Divorce Candor click HERE

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