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4 ways to enhance financial literacy during your divorce

On Behalf of | May 16, 2024 | Divorce |

Going through a divorce can be a highly emotional experience. Also, navigating its financial complexities can even be a daunting phase. If the divorce process puts your economic stability under scrutiny, how can you avoid a financial fallout? Moreover, how can you enhance your financial literacy during your divorce?

Understand your net worth

In Connecticut, the law requires the fair division of marital property. Therefore, it is essential for divorcing spouses to know their net worth. They must be aware of the following:

  • Bank accounts and cash reserves
  • Real estate holdings
  • Investment accounts such as bonds, stocks and mutual funds
  • Retirement plans like 401(k), IRAs and pensions

The spouses should also know their mortgages, loans, credit cards and other outstanding debts. If they are business owners, they must be aware of all their business interests as well as their intellectual property.

Value your assets

Additionally, couples must be aware of their asset valuations. They can request appraisals for their real estate properties, businesses and collectibles. They can also review statements for their investment and retirement accounts. In addition, those with professional practices can assess their future earnings potential.

Track your expenses

Furthermore, it is crucial for spouses to track their joint and individual expenses to better manage their finances. Among the living expenses that they should consider are their estimates for post-divorce budgets and alimony needs. Plus, parents may factor in their calculations for child support.

Know your taxes

Meanwhile, spouses should also know the tax implications of various divorce matters. They should take into account the tax consequences of asset transfers, alimony payments and dependent deductions.

Securing an equitable share

When ending your marriage, enhancing financial literacy can be a way to empower you to demand your fair share. With legal support, you may identify pitfalls and fight for an equitable share. Doing this may help you achieve a secure future and attain financial stability.