Women and Divorce: How to Keep Your Money

For anyone who has gone through a divorce in recent years, they can attest that it is much different than it was decades ago. Previously, housewives going through divorce were usually awarded an alimony and full custody of the children. However, divorce in the present will find that there is a better chance that the wife is the one making more money and the husband may end up with the alimony and custody of the kids. As a woman who is going through divorce, it is important to be well prepared. When approaching divorce, it helps to consider marriage as business deal that is coming to an end. You need to keep your emotions in check so that you give yourself the best possible financial solution. By following these guidelines you may come through your divorce with not only your money, but your sanity as well.

1. Plan for Your Divorce Before You File

If divorce is in your near future there are a few steps you need to take to protect your money. First, setup an individual account at a bank where you or your husband has never done business. Consult with your lawyer and then place in the account enough money to pay your legal bills and your household needs for several months. If this isn't possible, then ask your attorney to freeze all joint bank accounts until you both open separate accounts. After unfreezing the accounts you and your partner can agree on how much each spouse can take to fund their separate accounts.

2. Get the Right Help for Your Divorce

When you were married you had experts help you with your finances, insurance, investments and tax planning. When getting divorced you will need help from those experts as well. Obviously you will need a good divorce lawyer, but look into getting help from a fee-only financial adviser who knows about investments and taxes in a divorce process. This is even more important if you or your husband have an involvement in a small business.

3. Money or Investments in Your Divorce

One consideration you need to make with the settlement of your divorce is whether or not you need liquidity or investments. If you're an optimistic, you may want to try to hold on to the investments and the house to see if their values go up. However, it might be more prudent to take the cash and let your husband have the investments and the house instead. Decide what is more important for you to continue on without your husband.

4. Keeping the House in the Divorce

It is important that you think logically and not emotionally about your house in a divorce. It is just another asset like your other investments and must be dealt with dispassionately. The house and all its expenses like taxes, insurance, and upkeep should not cost you anymore than 35 percent of your take-home pay. The value of the house is not as relevant as whether you can afford to keep it on your own. If you do choose to keep the home, refinance it and take sole ownership of it. If your husband takes the home, make sure that he refinances it so that your name is off the mortgage and you no longer have any liability if he cannot make the payments.

5. Insurance Coverage and Divorce

If you were relying on your husband's company for health insurance, you can keep it for up to 36 months after the divorce under the COBRA plan. The premiums for the insurance will be up to you to pay and you might consider looking into a personal health plan that may save you money instead. If you have a life insurance policy, keep it. Life insurance is even more important after the divorce. You need to make sure that your children or older parents are financially taken care of if you are no longer around. However, you are no longer responsible for your husband after the divorce and you can usually save a significant amount on your life insurance premiums when you remove him.

Experts tell us that the number one reason couples get divorced is money troubles. Before getting divorced, consider financial counseling so that each partner knows what their role and responsibility if divorce is in the future. Couples who go through financial counseling learn to put their emotions aside and have to deal with the hard facts of money. Many times, when couples address their financial issues and resolve them, they decide to stay together.