Divorce can be financially stressful but there are things people can do to prepare themselves and protect their futures.

People in Harrisburg may look at divorce as a way to make a new start and get out of a difficult or dead relationship. However, they should also note that divorce can cause havoc on one's finances. Legal bills, the loss of a second income and other fees can put people into a precarious situation. By taking the time to financially prepare for a divorce, people can avoid unnecessary stresses and financial hardship.

Gather a full picture of your debt and income

When people are talking about divorce, one of the first things they should do, according to CNBC, is get a copy of their current credit report. The credit report provides a clear financial picture where they and their spouse are as a couple. It can also reveal if the other spouse has built up debt without their knowledge. Credit reports show any credit cards that have been opened, loans taken out, mortgages and second mortgages. They can alert people if their spouse secretly purchased another house or bought a car.

The other thing that people should gather is a copy of tax records. It is not uncommon for spouses to claim they make less than they really do, in an effort to avoid paying spousal support or child support. Some spouses will try to cheat the other spouse out of marital property by claiming the family business is doing poorly or that they never received their bonus from their employer. However, people usually don't lie on their tax returns and this can help people gain a full understanding of where they are at, income-wise.

Set up a budget

If both spouses work, they need to keep in mind that they are downsizing from two incomes to one. This means they won't be able to afford the same luxuries, trips or lifestyle that they did before, unless they make a large salary. Additionally, going through a divorce means that spouses will need to set up a new household and there are often fees for setting up new utilities, deposits on an apartment or transfer fees on banking and credit accounts.

A budget can help people look at their expenses and then make decisions such as whether they should downsize from their SUV to something more economical or if they really need to pay for cable. The budget should contain all living expenses and bills paid each month as well as expenses associated with the divorce itself such as attorney and court fees.

Avoid unnecessary legal and professional fees

Legal and professional fees can be devastating to people in a divorce and Fox Business states that while people should engage the help of these professionals, there are several things they can do to keep their costs down. These include the following:

  • Don't treat the attorney like a therapist
  • Assemble as many financial documents as possible before meeting with the professional
    • Mortgage statements, loan documents, credit card statements, car, health and life insurance statements, retirement account statements, and recent paystubs/W2's are all things your attorney will need.
  • Pick and choose legal battles carefully - arguing over simple visitation arrangements or a piece of furniture will only add up the fees.
  • Write down questions and concerns before meeting with the professional
  • Keep a list of questions in a notebook as you go so that you may ask your lawyer several questions at one time to maximize your attorney's time and decrease expenses.

When hiring accountants, financial planners and attorneys in Harrisburg, it is important to make sure that they are experienced and knowledgeable. People should do their homework to make sure that the professional is someone they can work with and who will act with their best interest in mind.

Keywords: divorce, assets, property