Financial Planning For Divorce In 2012

financial planning divorceBy Jennifer M. Paine

Michigan Divorce Lawyer

Financial planning is one of the most critical aspects of divorce. Accuracy and thoroughness on financial documents during the divorce is crucial.

But even before filing for divorce, you need to ensure that your financial situation is not in disarray.

In order to be prepared for a divorce in 2012, I previously outlined five steps you should take now to make the divorce process easier.

In this article I’ll share five divorce tips for men on how to handle your finances before a divorce is filed.


1. Gather Financial Documents. All of your bank accounts, credit card accounts, retirement accounts, investments, etc., will be valued during the divorce process.

Depending on when you acquired them and what you did with them, they may remain yours. But, even if they do, you must still identify them. So start now.

These records have a funny way of “disappearing” when one spouse files for divorce, so extra copies are a good idea.

At a minimum, you should copy: your last five years of tax returns; last year’s worth of bank and credit card accounts, investment statements, retirement statements, and so forth. Save these to a flash drive for your attorney to download.


2. Make Your Budget. You should plan for emergency and extra expenses now. These include filing fees, attorney fees, housing expenses (more on that below), health insurance you may have to purchase, etc.

Build in an emergency fund, if possible, for vehicle repairs, last-minute health expenses, and so forth, but do not make it too large – the larger the reserve, the more you have available to pay as alimony.

You will want to know how much you have to work with so that you select the most appropriate long-term option.

3. Research Housing Options. Except in rare circumstances, you should not plan to move out of your marital home. If you do, your budget will double, at least, you will lose parenting time with your children, and you cannot control what happens to your belongings, or your children, that you left behind.

However, you should start researching housing options now. Perhaps you will remain in the home but will refinance – what do you need to do so? Perhaps you will sell the home – who will you use, and will you make a profit? Perhaps you will short-sale the home – but will you complete that sale in time to take advantage of the federal program, set to expire in 2012, that will allow you to exclude the forgiven debt from your 2012 taxable income?

Perhaps you want to rent a home in your children’s school district if the judge orders you to leave the house – so get online and start searching for a home.


4. Start a Separate Bank Account. Separate accounts are a delicate issue. You should not tell your wife that you are opening a separate account, but you should also not expect to keep it a secret throughout your divorce. You will be required to disclose it.

But, if you open an account and start putting money in it too soon, you send a giant red flag with the letters D-I-V-O-R-C-E waving at your wife.

Guys often ask us, when should I open the account, and how much should I put in it? Generally, and subject to the facts in your marriage, you should open the account before you file and deposit enough to pay the family bills into the account a day or so before filing.

You are not setting this money aside so that you can hide it or keep it – you are setting it aside so that it is protected and available to pay marital expenses so that your wife does not pocket it all.


5. Check Your Credit. You can run a free credit report annually online. Look for any missed or late payments, as these are often a sign that your wife, who was supposed to be paying the bills, deposited your paycheck somewhere else.

Also, look for debts in your name that you were unaware of, such as credit cards that are issued jointly to husbands and wives.

Keep this report with your financial records for your divorce lawyer. Beware, however, that you cannot run your wife’s report without her express permission – it is a federal crime if you run the report without it.


If you are planning to divorce in 2012 – and you have taken the steps necessary as outlined in this article and my previous article, “How To Be Prepared For A Divorce In 2012” – then consult with a mens divorce attorney to determine the best legal strategy to use in your particular situation.

An experienced divorce lawyer will know how to advocate on your behalf, safeguard your assets, and ensure your rights – and your children’s rights to have a father actively involved in their lives – are protected


Jennifer M. Paine is a Michigan Divorce Lawyer with Cordell & Cordell. She is licensed to practice in Michigan, and has been admitted pro hac vice in Illinois, Ohio, and the United States Court of Federal Claims.

Ms. Paine received her BA in English and Mathematics from Albion College and graduated Summa Cum Laude. She received her Juris Doctorate from MSU College of Law and graduated Summa Cum Laude.

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