Love is uncertain, your finances aren’t – what to do when the love is gone (Part 1 of 2)
Marci • April 27, 2012
The two of you are separating and suddenly you face not only emotional upheaval, but financial changes as well. At a time when your head is already spinning, you need to wrap your head around the shift in income, the current asset and debt picture and what to do with the house.
The steps you take now will have a huge impact on the final settlement and your life going forward. (No matter how overwhelming it may feel, remember you will have a life going forward!) Take it slowly. Here’s where to start:
STEP ONE – Make lists:
This step will be tedious, but it may be the most useful thing you do as you move through your separation and finalize your divorce.
- List your household ASSETS. You must list everything. From your cash and savings to physical items with a financial value; and don’t forget the little things like travel points!
Take the time to create a list like the one below. It will be time consuming but keep in mind you’re doing it to benefit your future.
| Asset Description | Mine | Yours | Joint | TOTAL | |
| 1 | |||||
| 2 | |||||
| 3 | |||||
| 4 |
2. List your LIABILITIES. Again, you must list everything. Car leases/loans, lines of credit, student loans, all credit cards (don’t forget gas and department store cards), even debts to family members must be on this list.
| Liability Description | Mine | Yours | Joint | TOTAL | |
| 1 | |||||
| 2 | |||||
| 3 | |||||
| 4 |
Now you can see clearly which assets and liabilities are jointly owned and which are in separate names. An important goal in the process is to ensure you both walk away with clean credit. Even while things are being worked out, you must commit to keeping payments up to date.
Wherever possible, have your name removed from credit cards and lines of credit that you do not have access to or that you are not using. If you do not have a card that lists you as the primary card holder, now is the time to get credit established in your name only.
STEP TWO – Work out your Monthly Cash Flow:
This is never fun. Take time to record all of the money coming in and going out. By keeping careful records for a month or two you will see the pattern of spending. This step is essential for two reasons: 1 – it will help you set a budget for your future life and 2 – this will help clarify any future support payments.
With the lists and cash flow behind us, the next post will cover paperwork, the mortgage and hardest of all: talking to your spouse.
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