Divorce is expensive. It can cost you time, money and emotional capacity. Fortunately, there are things that you can do to minimize the financial cost of your divorce. Avoid making these mistakes during your divorce.
Fighting for the home
There are many reasons who you may want to stay in your house. It can be easier for the kids, is less of a hassle than moving and can allow you to stay somewhere you’re comfortable. However, it can also be filled with difficult memories and lots of expenses. If you don’t fully understand the implications of taking over the house, you may have a mortgage, estate taxes and a house that’s worth less than you now owe.
Cashing out investments
Investments can seem like quick ways to pay your divorce bills but cashing out may not be the best thing to do in the long run. Keeping your investments will ultimately help your financial health.
Not planning for taxes
As your estate changes with the division of property, you need to plan for the taxes that you will need to pay. Not accounting for the taxes you will have to pay means that an unexpected bill may hit you.
Not adjusting to a new budget
It can be difficult to re-learn your budgeting when on one salary instead of two. Still, it’s important that you understand your new financial state so that you don’t dig yourself into a hole. Start by calculating your expenses and recognizing that you now have a lower income to work with.
While divorces are certainly costly, there are ways to minimize the expenses. You can talk to a financial advisor and your attorney to make sure that you don’t make expensive mistakes.