Divorce Financial Planning Checklist 

Few events in life can leave you as devastated as a divorce. Navigating the divorce process while simultaneously coming up with a plan to rebuild your family, life, and finances after divorce is more than enough to handle.  

What many people are reluctant to admit is that divorce is a financial decision. Financial planning for divorce is the one opportunity you have to cushion yourself from the disorienting blow of divorce.

Divorce and money, personal finances and divorce — they go hand-in-hand. Irrespective of who you are or the current climate of your relationship, our divorce financial checklist will help you organize the naturally chaotic process of divorce financial planning. We’ve broken the topic of divorce finances into five phases:

  1. Pre-Emptive Divorce Financial Planning
  2. Planning for Life After the Divorce
  3. Funding the Divorce
  4. Staying the Course
  5. Separating, Recalibrating, and Starting Again

Be sure to download or print this divorce financial checklist for your records.

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Phase I: Pre-Emptive Divorce Financial Planning

When it comes to divorce and finances, it is true that the best defense is a good offense. That means planning from the beginning how you’re going to manage your divorce and money in the event of a divorce, even as you and your beloved are trying to decide between having a throwback band or a dubstep deejay entertain at your wedding.

If you’re already married but have come to place where divorce is your only option, do your divorce financial planning before filing to minimize the likelihood that your finances after divorce will end up in shambles.

According to an article published on USNews.com, courts require couples filing for divorce to begin with mandatory disclosures, which serve as financial proof of each spouse’s income, assets, expenses, and liabilities.

These include:

  • Federal, state, and local tax returns for the past three years
  • Earnings statements like Forms W-2, 1099, and K-1
  • Recent paystubs
  • Deeds, wills, life insurance, bank accounts
  • Investment portfolio, retirement accounts, contracts
  • Credit cards, current loans

Add that list of documents to your divorce financial checklist and gather them ahead of filing for divorce to give your attorney time to comb through them.

Skip doing the divorce yourself. If you have any assets at all, you will want an attorney to take steps to fairly divide assets during the divorce settlement to protect your finances after the divorce. Celebrity cases aside, divorce is rarely the windfall the tabloids make it out to be.

Use a divorce financial checklist, make a plan, and honestly assess your current finances against your potential finances after divorce. The unexpected happens during divorce, and finances are not something you want to leave to chance.

divorce and finances

Image Source: Divorce Financial Planning

Phase II: Planning for Life after Divorce

In an Investopedia article, Andrew Beattie writes, “One of the most difficult things about a divorce is deciding who gets what.”

Divorce is about who gets what.  Make no mistake, the courts are there to ensure both assets and liabilities are accounted for when it comes to divorce and finances.  Your lifestyle will be affected.

According to Beattie, both parties of a divorce typically emerge needing to go to work in order to get a handle on their finances after divorce. With everything from your housing to your credit rating on the line, it’s a good idea to put together a game plan for how you will move forward.

Decide if you will need to:

  • Downsize your house until you rebound financially
  • Drive a more modest car
  • Get a roommate
  • Talk to a tax professional about the tax consequences of your divorce settlement

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Also think about:

  • The size of the gap between the alimony you receive and your actual cost of living
  • The reality that child support payments probably won’t cover the actual cost of child rearing
  • How paying alimony and child support will affect your standard of living
  • Finding your own insurance; it’s generally a less expensive option than staying on your spouse’s insurance or taking advantage of COBRA
  • Signing up for a credit monitoring service that will allow you to keep an eye on your credit report and your credit score
  • Getting additional training to make yourself more competitive in the job market

For women in particular, acquiring additional training and even re-careering is essential for strengthening finances after divorce.

A recent Huffington Post article entitled “The Real Reason Women Still Make Less than Men” reported one of the reasons women make less than men is they typically have fewer years in the workforce than men due to child rearing. Women also tend to earn less because of the ongoing need for flexibility to care for even school-aged children.

While the article doesn’t specifically address divorce and finances, it still presents important points that we’ve included on the divorce financial checklist for you to consider during divorce financial planning.

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Phase III: Funding the Divorce

divorce financial planning

Image Source: Divorce and Finances

Something else to consider when it comes to divorce and finances is the cost of the divorce itself. Getting a divorce isn’t cheap. Include this cost in your divorce financial planning. 

The cost of divorce is affected by the city and state in which you live and by the complexity of your case. The general consensus is that divorces can cost anywhere from $15,000 to $20,000 with per-hour rates for divorce attorneys ranging from $75 to $400.

In addition to attorney’s fees, you will also have to foot the bill for court costs, parenting classes, and mediation costs. There can be other costs associated with restructuring your finances after the divorce, which could include re-titling property, refinancing property, liquidating assets, and paying capital gains taxes.

To minimize divorce expenses and protect your post-divorce finances, plan ahead. The less you have planned, the longer your case will last. The longer your case lasts, the more you and your spouse will rack up in attorneys’ fees.

If you and your spouse can agree on important issues, another option is to choose mediation over litigation. It’s cheaper and faster.

Phase IV: Staying the Course During the Divorce

Even if you have diligently worked at financial planning for your divorce, one of the biggest challenges you face is staying focused during the divorce. Money is a touchy subject, compounded by the rigors of splitting up and splitting everything. Expect your divorce to be physically, mentally, and emotionally draining.

Contrary to what some ads want you to believe, divorce is not a quick process. According to Nolo.com, the average divorce takes 10.7 months to complete from the time the divorce papers are filed until the courts finalize the divorce and issue a final ruling.

In cases where the spouses could not resolve important issues on their own, like child custody, child support, division of property, and division of debts, divorces took an average of 17.6 months for the courts to finalize.

A window of 10 to 17 months provides plenty of time for hurt feelings to erode the relationship between you and your spouse. If you’re not careful, you can find yourself tiring out and becoming a spectator in your own divorce.

Here are some strategies for remaining focused and engaged:

  • Hire an accountant who can help you uncover the possible advantages and disadvantages of your settlement
  • Focus on what you have planned for life after divorce
  • Maintain control of your emotions and stay conscientious in your efforts without trying to dominate the proceedings
  • Act quickly to provide your legal team with the documents needed to help you sort out divorce finances
  • Fight fair and fight for what’s yours
  • If you have children, save time, energy, and smiles for them to help them navigate this difficult situation
  • Be prepared for the worst; it happens, but you don’t need to be railroaded by it

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Phase V:  Separating, Recalibrating, and Starting Again

In the final phase of financial planning for divorce, it’s time to take inventory of what you have left once the dust settles and begin evaluating your post-divorce finances.

Here are the nine tasks to act on immediately from your divorce financial checklist:

  • Review your post-divorce finances to figure out what’s left, what’s needed, and where you can make changes. This is the time to temporarily downsize your lifestyle a bit if necessary.
  • Pay down marriage debts to get rid of any debts you and your spouse accumulated during your marriage.
  • Cancel joint bank accounts and credit cards; never assume your spouse “would never…” Protect yourself and your finances after divorce.
  • Update your health and life insurance policies to reflect the change; add or remove beneficiaries as necessary.
  • Put your assets in your name.
  • Change passwords to your financial, email, and social media accounts; remove sensitive information from computers.
  • Hire a professional to help you analyze your post-divorce finances; the investments that you and your spouse had may not be the best options now that your financial situation has changed.
  • Start rebuilding your savings.
  • Revise your budget to suit your new lifestyle.

Never let it be said that divorce is easy. It’s never easy getting rid of the old and walking into the new. But there are tactics you can use to help you stay organized, remain focused, and rebound successfully from a divorce.

So, get married. Expect the best. Plan for the worst. And if things fall apart, you can save yourself and your spouse a lot of pain, time, and money by having a contingency plan in place for how to handle finances and divorce.

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Divorce Financial Checklist

Phase I: Pre-Emptive Divorce Financial PlanningDocuments to prepare before filing for divorce:

  • Federal, state, local tax returns for the past three years
  • Forms W-2, 1099, K-1
  • Recent paystubs for you and your spouse
  • Bank statements, CDs
  • Property ownership and appraisal records
  • Health, life, auto insurance policies
  • Investment portfolio, retirement accounts
  • Pre-nuptial agreement, separation agreement
  • Credit cards, loans, bills


Phase II: Planning for Life After DivorceImportant issues to decide before filing for divorce:

  • Downsizing your house and car temporarily
  • Getting a roommate
  • Getting professional help to plan your next steps
  • Finding your own health insurance
  • Signing up for a credit monitoring service
  • Getting additional training to make yourself more competitive in the job market      
  • Assessing alimony and child support payments
Phase III: Funding the DivorceFigure out how you will pay for the divorce:

  • How much will the divorce cost?
  • How much can you afford in attorney’s fees?
  • What can you and your spouse work out now to minimize the amount of time you have to spend in court?
  • Is your spouse willing to forego litigation in favor of mediation?
  • If you have children, how long do you have to wait in your county before the court will finalize a divorce?     
Phase IV: Staying the Course During the DivorceTips for navigating, managing, and remaining an active participant in your divorce:

  • Focus on the life after divorce
  • Exercise self-control
  • Don’t try to dominate the process
  • Fight fair and fight for what’s yours
  • Help your children get through the divorce
  • Be prepared for the worst
Phase V: Separating, Recalibrating, and Starting AgainTips for re-creating your finances after divorce:

  • Review your post-divorce finances
  • Pay down lingering marriage debts
  • Cancel joint accounts
  • Add or remove beneficiaries from your insurance policies
  • Re-title your assets
  • Change passwords to your accounts
  • Delete sensitive information from computers
  • Start rebuilding your savings
  • Revise your budget to suit your new lifestyle

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