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Budgeting an important part of navigating divorce

For those getting divorced in Montana, the impact on their finances may be significant. This is true whether they have decided to handle their divorce matters at trial or outside of court. A few tips can help one to be as financially prepared as possible to avoid expensive mistakes that can have both short-term and long-term implications.

First, creating a budget as soon as possible during the divorce may be expedient. This budget can be created from expenses and income sources. However, assets can also be included in the budget, which is why having a relatively good idea about which assets one will end up keeping is important during the budgeting process.

Once a budget has been developed, having a strong financial plan in place to cover personal goals and obligations is paramount. These goals and obligations may include, for example, retirement, college costs, health care costs and any other money-requiring activities. The financial plan will essentially determine one's future and current financial health. This plan makes it possible to achieve a positive future rather than running out of funds before reaching retirement or during the retirement years.

Understanding what the future might look like can help with negotiating a divorce agreement that is as equitable as possible. The benefit of negotiation versus litigation in Montana is that both parties can feel more in control of their marital dissolution rather than relying on a judge to decide for them how to split up their assets or address spousal maintenance, for example. It is especially beneficial for those with minor children, as they can practice early on how to resolve their issues without further court intrusion, which will be helpful as they co-parent in the years ahead.

Source: mvtimes.com, "Finance 101: Divorce?", John Kageleiry, Aug. 21, 2017

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