Financial planning steps, such as opening your own bank and credit card accounts and making an inventory of all marital and non-marital property, can streamline a divorce in Arlington Heights, IL. Common considerations on how to make a divorce easy with financial planning include whether your divorce is contested or uncontested and your financial goals after the divorce.
The Divorce Process in Illinois
Each state has different divorce laws, and it is important to understand the regulations in Illinois.
Divorce Laws and Requirements in Illinois
Illinois is an equitable distribution state for marital property and marital debts. This means strict 50/50 division is not the priority. Rather, fair or equitable distribution is. It can depend on factors such as a spouse’s contribution toward obtaining and maintaining the property and each spouse’s present and likely future financial circumstances.
As you plan financially, it helps to know what is marital property and what is separate property. For example, if you have individual accounts you opened at a bank before your marriage and have kept them solely yours, the money there may be separate property and yours to do with as you wish.
The same could apply to gifts and inheritances only you received, whether they happened before or during the marriage. The key thing is to not commingle separate property. Otherwise, it may become marital property.
Different Types of Divorce
The two main types of divorce are contested and uncontested. You may have to go to trial in a contested divorce unless you and your spouse are able to reach a settlement. Then the divorce becomes uncontested. Regardless of the path you see yourself heading down, whether it is a collaborative divorce or not, be as well-prepared as possible with your finances.
Financial Implications of Divorce
The financial implications can be tremendous and last for years. They often encompass issues such as houses, cars, child support, and income.
How Are Assets Divided in a Divorce?
Who gets the house in a divorce? It depends. A primary consideration is whose name is on the title, deed, and mortgage.
Other variables could include whether one or both spouses want to keep the house or sell it, their ability to afford the house on their own, and whether the children would live there and the type of custody. Sometimes, a spouse is able to use child support and spousal support to make house payments.
A divorce lawyer should be able to answer your questions in more nuanced specifics. Just one detail can change the shape of a case.
If your divorce in Arlington Heights, IL, is uncontested, you and your ex figure out the division of assets yourselves, a judge is likely to approve the agreement.
In a contested divorce where assets are an issue at trial, a judge decides the division. You have to comply with what the judge orders. For this reason, among others, many couples try to choose an uncontested divorce when possible. Leaving all the issues in the hands of a judge may result in arrangements they would not have reached for themselves.
How Is Child Support Calculated?
You and your spouse can agree on child support amounts yourselves, which a judge will have to approve. A judge could decide the issue at trial in a contested divorce, too.
A common way to calculate child support is to use the Illinois Child Support Estimator from the Department of Healthcare and Family Services. Variables include the number of children, who has the majority of the parenting time, the parents’ income types, whether there is spousal maintenance, whether the parents are covering health insurance, and whether the parents pay child support already for other children.
Steps for Financial Planning in Divorce
Start your financial planning for divorce as early as possible. If you are the one filing for divorce or are aware one is coming, start planning beforehand. Your divorce attorney can help with specifics, such as how to make a fair spousal maintenance agreement.
Gather Essential Financial Documents
Your marriage may have been one in which only one of you handled finances. If you were not involved in managing the finances during your marriage, it can be tricky to access financial statements and similar documents, especially if your spouse is resistant. Your divorce attorney can help.
Otherwise, collect documents such as bank statements, tax returns, health and life insurance information, investment account documents, retirement benefits, credit reports, deeds, mortgages, titles, and paperwork on lines of credit. You can never gather too many documents, so even if you think something is not necessary or pertinent, include it.
Catalog what is marital and non-marital property. Try to determine the worth of all of your assets and debts, whether they are separate or joint. Get documents to support your case that your separate property is separate.
Assess Financial and Lifestyle Goals Post-Divorce
Post-divorce, you’ll probably have less money and more expenses. Start before or during your divorce to track your spending and expenses.
You may have goals in mind before the proceedings. However, you may realize in time that they are not feasible, at least not right away. It helps to remain open-minded and flexible during a divorce.
Budget and Establish a New Financial Plan
The following steps should help you get a handle on your financial and lifestyle goals.
- Create a budget with your new financial circumstances in mind. Include any support payments you’re making or receiving.
- Consult with a financial advisor if you need higher-level help with managing assets and investments.
- Adjust your long-term financial goals to sync with your new path in life. For example, you may need to review or revise retirement savings, insurance, and estate planning documents.
- Account for changes in family dynamics and living arrangements, and how they may affect your personal goals and priorities.
- Prioritize emotional support from loved ones.
Divorce can be stressful. Fortunately, making a financial plan gives you something tangible to work toward. Having a roadmap can help with making divorce easy.
