Tips to Help Maintain Financial Stability After Your Illinois Divorce

 Posted on December 24, 2019 in Divorce Finances

As much as marriage is an emotional and cultural bond, it is also very much a legal and financial partnership. When you are married, as far as the state of Illinois is concerned, what is yours is also your spouse’s, and vice versa. Although keeping finances completely separate is not impossible during a marriage, it is somewhat rare. When you get a divorce, untangling your finances can be a huge headache for both you and your spouse. For some people, divorce can even be the beginning of financial downfall -- but it does not have to be. Below are a few tips you can follow to help yourself maintain a sense of financial stability during and after your Illinois divorce.

Create a Post-Divorce Budget and Manage Your Expenses

One of the first things you should do is create a rudimentary budget to use after your divorce. If you are still early in the divorce process, you may not know exactly what all of your expenses or income will be after your divorce, but you do know that you should expect some changes. Keep in mind that you will have to budget for one income only, and you will probably have to determine new living expenses. This is also a good time to look at your spending habits and see where you can cut back.

Make Sure Your Marital Property Is Divided Fairly

Your marital property and how it is divided in your divorce can affect your financial health in the future. In Illinois, marital property is considered to be any assets that were acquired after you and your spouse were married, meaning you both have a stake in the property. For example, if your spouse has a retirement fund, you are entitled to a portion of the funds that were added while you and your spouse were married. The division of property is determined by “equitable distribution,” which means assets are split fairly but not necessarily 50/50.

Do Not Forget About the Tax Implications of Your Divorce

If you and your spouse have valuable assets, such as a home, retirement accounts, or investment accounts, you should be aware of how the division of these things can affect your taxes. For example, if you and your spouse end up selling your house, you could be subject to capital gains taxes. Retirement accounts such as a 401(k) may be subject to taxes as well, especially if funds are withdrawn before the account holder reaches retirement age.

Contact a Yorkville Divorce Attorney

Getting a divorce is often considered to be the first step toward a fresh start. The last thing you would want is for that new beginning to be riddled with financial woes. Taking a proactive approach to the financial consequences of your divorce is the key to ongoing success in your post-divorce life. At the Law Office of Matthew M. Williams, P.C., we have the knowledge and experience to help you properly plan for a secure financial future after your marriage ends. Contact our Kendall County divorce attorney today at 630-409-8184 to schedule your consultation.

Sources:

https://www.usatoday.com/story/money/2019/08/07/divorce-how-file-without-wrecking-your-finances/1932401001/Kane

https://money.usnews.com/money/personal-finance/articles/2016-09-29/10-ways-to-prevent-a-divorce-from-ruining-your-finances