Struggling with divorce can make the holiday season difficult. Navigating family get-togethers full of questions and trying to keep a brave face for any children involved are huge challenges in an unstable marriage. But try not to let the prospect of divorce get you down, as the calendar changes and a fresh start presents itself. With some forethought and financial planning, the start of the year can be a perfect time to think toward the future and plan ahead for the rest of 2012.
This is the time of the year that banks and credit card companies are sending out year-end statements. Use these to start a collection of essential financial documents. In addition to these statements, your collection should include:
•· Bank account information
•· Mortgage statements
•· Credit card bills
•· Wills and trusts
•· Other estate planning documents, like powers of attorney and advanced healthcare directives
•· Credit reports
While you’re thinking about finances, consider the upcoming tax season. April may seem far away but it’s never too early to start thinking about the interplay of divorce and tax issues. You may not want to file a joint 2011 return with your spouse if you plan to separate during 2012.
Take special care if you suspect any financial wrongdoing by your spouse; there are IRS rules to protect innocent spouses, but your best bet is usually to file separately. A divorce lawyer and tax accountant can both help you determine the best way to handle taxes related to an upcoming divorce.
It’s hard to save money during the holiday season with extra expenses like gifts, travel and social obligations, but try to secure some money that your spouse can’t access. In the aftermath of the financial crisis, it’s harder than it used to be establish credit, especially if your spouse has been the primary breadwinner during your marriage. Give yourself plenty of time to ensure that you are on steady footing for a financially sound life after divorce.
With a little advanced planning, you can spend less time this New Year worrying about your divorce and more time enjoying family traditions and looking forward to building new ones.