Assets, Liabilities, and Cash Flow
Completing a budget and obtaining accurate information about income is always difficult because people seldom keep track of their expenses. Yes, this area can be the most useful part of the divorce process. When each of you present your own budgets listing your separate living expenses for the future, it is easier to see how each of you will unhook financially from the other.
The discussion about budgets and incomes helps answer the question of child support, spouse support (alimony) and how much money each of you will have to spend on yourself and the children each month. The purpose of paying child support and/or spousal support is to ensure that one of you will not have to continually ask the other for money, and the other will not have to worry about whether enough money has been provided to meet the expenses of the other spouse.
First list and then divide your marital property.
Even if you believe you have already worked out a property division, it is important to go through the process. The reason for this is that the two of you may not be aware of the ramifications of any arrangements you have made.
Steps involved in dividing property:
- Listing and understanding all property
- Establishing or agreeing on a value
- Identifying non-marital property
- Defining a standard of fairness
- Developing options
- Deciding who gets what
If neither you nor your spouse has documents for a particular item, and the two of you cannot agree on the item’s value, then make a note by that item indicating that you two will return to it later. If this happens, collaborate with each other on choosing a neutral expert, then have the item appraised, and then use the documentation of the appraised value. Examples: the marital residence, vacation home, life insurance, etc.
For some people, creating a budget is a simple task; others have trouble with it, especially if their spouses have handled the household finances during the marriage. In any case, this job becomes an opportunity to really evaluate your priorities, and it must be done.
Find out about Guided Do-It-Yourself
Find out about Establishing a Parenting Plan
Find out about Your Own Future Plans