8 Tips to Help You Financially Prepare for Divorce

The decision to divorce your spouse is never an easy one, and moving forward without knowing how it could impact your finances could add extra stress to an already difficult situation.

It doesn’t matter if you’re filing for an uncontested divorce, seeking mediation to end your marriage, or moving forward with legal court proceedings. You need to financially prepare for divorce and the next stage of your life. 

#1: Start saving to pay for the divorce 

Divorces can be expensive. Experts suggest that, on average, a divorce costs $10,100 per person if the couple doesn’t have children. If the couple does have children, the average is $15,500. The cost can also fluctuate by state.  

Some of the common costs associated with divorce include: 

• • Attorney fees 

• • Court costs 

• • Parent education classes 

• • Early neutral evaluation fees 

• • Mediation costs 

• • Refinancing cost on your home (if you own it) 

• • Record deed fees on your home (if you own it)  

The more amicable your divorce, the less it’s going to cost. That said, it won’t hurt to start saving money now. Splitting marriage and finances often causes friction in even healthy relationships.  

Anywhere from $10,000 to $15,000 is a good savings goal for your divorce. You should also consider starting an emergency fund that only you have access to for your own financial independence.

That way, you’ll have money set aside that can cover unexpected expenses during the divorce process if needed. 

#2: Gather any key financial documents 

Gathering current and past financial statements can help you get a clear picture of your current finances before a divorce. Some of the paperwork you should start collecting includes: 

• • Assets (checking, savings, and investments) 

• • Property (home, land, vehicles) 

• • Debts (credit cards, lines of credit, personal loans, mortgages) 

• • Household expenses (phone, internet, insurance, utilities) 

• • Retirement accounts (IRAs, 401k plans, pensions) 

• • Income (from pay stubs and tax returns for the past three years) 

• • Personal items worth more than $500 (firearms, collectibles, boats, recreational vehicles, art, jewelry) 

It’s usually helpful to break your assets and debts down into two categories:  

• • List of assets and debts brought into the marriage  

• • List of assets and debts accumulated since marriage  

If trying to find all these on your own feels overwhelming, consider using this divorce checklist from the Institute for Divorce Financial Analyst.  

#3: Note where you need to make important updates to your accounts  

Make a list of where you’ll need to make changes when you finalize your divorce.  

Things you need to note and change later 

• • Any joint accounts you’ll need to close 

• • Any titles from which you will remove someone’s name 

• • Anywhere you’ll need to update your beneficiaries  

• • Anywhere you’ll need to update your name or address 

Things you should change or do now to protect yourself 

• • Open an individual bank account if you don’t already have one 

• • Set up your direct deposits so all money moving forward goes there 

• • Change passwords and PINs to individual accounts and cards 

• • Open your own retirement account (if you think you’ll be entitled to a portion of your partner’s retirement assets post-divorce)  

Don’t move any money in your current accounts until your legal representative tells you to. If you’re awarded retirement money, you will likely want to request a Qualified Domestic Relations Order (QDRO) as part of your settlement.

This allows you to transfer retirement assets from one person’s account to another retirement account without tax penalty. 

#4: Don’t neglect your bills 

Neglecting joint bills can hurt both of your credit scores. Instead, continue to pay at least the minimum amount on all your bills and outstanding debts.  

This may mean transferring some of your income into an old joint checking account to cover outstanding bills or moving some money from savings to cover any overdraft fees. If your name is on their bill and you’re worried they might not pay it, ask to be removed from the bill. 

#5: Seek out financial advice 

Does your spouse manage your finances? Has it been a while since you managed your own finances? Or maybe you’ve never managed your money before. If any of these resonate with you, it’s time to get some help. 

Even if you’re over your family’s finances, divorces can get messy and may be more complicated than expected. Meet with a financial professional before you file for a divorce, or as soon as possible if you’ve already begun divorce proceedings.   

If you have friends or family who are recently divorced, you can ask them if there’s anyone they recommend. You can also look for a certified divorce financial analyst (CDFA) or a financial planner. 

#6: Familiarize yourself with your state’s divorce laws 

Did you know that each divorce is directly impacted by the laws of the state you live in? So, even if your cousin in another state gave you well-meaning advice, it might not actually apply to you.  

Consult with a licensed attorney in your state before moving money, changing accounts, or making any big purchases. They’ll be able to help guide you through your divorce in the way that best fits your needs and state regulations.  

#7: Track your current expenses 

Tracking your current expenses can help you accurately determine your household income and expenses.  

Your attorney and judge will also ask for and consider this information when deciding how to split assets and debts and whether to award spousal or child support.   

The longer you can track your budget, the better. Look at bank and credit card statements to get an understanding of what your spending looked like over the last year.  

Tally up the cost of items like: 

• • Household bills 

• • Food 

• • Clothing 

• • Entertainment 

• • Home maintenance 

• • Transportation 

• • Childcare  

• • Subscriptions  

#8: List out future expenses 

While your divorce may feel like an abrupt ending, the reality is it’s also a new beginning. This means you should also consider creating a budget to financially prepare for your life after your divorce.  

Consider your household expenses, like bills and groceries. Identify any items that could change once your divorce is finalized, like extra childcare support or insurance costs.  

If you’re feeling nervous about the amount you may be spending compared to your income, ask yourself tough questions like, “What am I not willing to let go of?” and, “Where could I scale back now that my income has changed?” 

Consider how the amount you spend on these expenses may change if you have children:  

• • Childcare 

• • School and after-school activities 

• • Your child’s first car  

• • Tutors 

• • College tuition 

If you’re hoping to receive alimony, you’ll need a clear picture of your current and future financial circumstances. This can help you show a judge why you need financial support. 

Starting from scratch isn’t the same as starting over 

Financially preparing for divorce isn’t about surviving the process—it’s about setting yourself up for a more stable future. 

Preparing for your divorce with the right financial documentation will help the entire process move faster and save you money. 

That’s a kind thing for you to do for yourself and your ex-spouse. 

Frequently asked questions to financially prepare for divorce 

How much should I save for my divorce? 

Experts suggest saving between $10,000 to $15,000 as a goal for covering divorce costs, which can include attorney fees, court costs, and other expenses. Having an emergency fund separate from joint finances is also recommended. 

What financial documents do I need to gather? 

Collecting documents such as current and past financial statements, assets (like bank accounts and property), debts, retirement accounts, and income records for the past three years can provide a clear financial picture before divorce proceedings. 

What changes should I make to my accounts during divorce preparation? 

While legal advice is crucial before making changes, consider opening an individual bank account, updating direct deposits, changing passwords, and possibly opening a separate retirement account. Avoid moving money until advised by legal counsel. 

How should joint bills and debts be handled during divorce? 

Continue paying at least the minimum amount on joint bills to protect credit scores. Discuss with your spouse how to manage these expenses until a formal agreement is reached. 

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