Some people in California may find that divorce introduces a number of financial challenges. In addition to having their assets and income cut in half or less, some people may find themselves responsible for their ex-spouse’s legal bills or other expenses. Therefore, it is important for people to have a plan for getting their financial lives in order after a divorce.
Going through a divorce is a stressful process, and some people may feel overwhelmed with worry. However, it is important to adopt a solution-focused mindset. Individuals should get a clear picture of their finances so they know what needs to be done. They might want to use spreadsheets to get a sense of assets and debts and to make a budget. People who are uncertain about what they are spending should adopt a conservative attitude until they have more data. Even if the news is bad, such as learning that expenses exceed income, this exercise gives people the information they need to take the next steps.
Prioritizing is important. This could mean taking control of one’s budget or addressing other issues, such as moving or increasing one’s income. People may also need to seek emotional support from friends, family and therapy. By educating themselves and putting and a plan in place, people can begin moving forward after the upheaval of a divorce.
There are a number of issues that affect how a person’s finances will look after a divorce. In a community property state like California, each person is usually entitled to half of any assets that were acquired after the marriage unless there is a prenuptial agreement. For the spouse that earns less, this might mean getting a portion of a retirement, investment or other account, which can be important in establishing financial security. The spouse that earns more may recover more readily from financial setbacks but might also have more to lose in the divorce.