By Joe Dillon, divorce mediator
As a stay at home mom, you and your husband each had your role. He worked outside the home, you worked inside the home, and everything was going along nicely.
Until one day one of you decided it wasn’t.
Now that you’re facing a divorce, there are a lot of things you’ll want to do to make sure your divorce goes as smoothly as possible. And that you’re prepared for your new life once your divorce is final.
But in my experience, here are 5 smart tips that aren’t even on most people’s radar and can make a huge difference between “just surviving” versus “thriving” post-divorce.
Even if you have an accountant that you and your husband have used forever, now that you’re facing divorce, you’ll want to find an accountant of your own. Having your own accountant can come in handy for two reasons.
First, there may be times during your divorce that you’ll want an accountant to review potential settlements. And help you understand the tax consequences of them. Having your own accountant, and not an accountant you shared with your husband, will help make sure you get guidance that’s in your best interest.
Second, divorce does create some tax headaches, especially in the first year or two. There may be a period of time when you co-owned a home together or forms you’ll need to file to ensure each of you claims the correct children on your return. Having an accountant handle all of this will be a big relief and prevent you getting a “love letter” from the IRS!
Much like an accountant will do from a tax perspective, a financial advisor will help you examine potential settlement options from both the cash on hand and future planning perspective. They can help you invest any retirement or non-retirement funds you receive as part of your divorce, help you put together a budget so you know how much support you may need post-divorce, and generally keep you out of the financial doghouse.
I know for many of us retirement may seem like a long way off, and since as a stay at home Mom there’s no 401(k) for your position, making smart moves now, as guided by an experienced financial professional, will greatly improve your chances of having your retirement years be your “golden years.”
One of the biggest mistakes I see couples make as a mediator is guessing what their home is worth. Chances are your home is your single biggest asset, so have it properly valued and don’t rely on websites like Zillow or Redfin to value it for you. Failing to do so can lead to all kinds of headaches down the road as Internet values can be off by significant amounts.
If you have any inclination of buying the house out from your husband, or he from you, you’re going to want to make sure the sale price is a fair one. Not just one pulled out of thin air or taken off the Internet. Most appraisals cost $300-$400 and can help you avoid a $10,000 (or more) mistake.
Getting your home appraised is just one part of the equation. An appraiser is going to look at the value of your home from a very analytical perspective, comparing it to “comps” in your area that have recently sold, to come up with a price.
But what happens if you buy the home from your husband, and find out there are some major repairs needed? When divorcing couples buy out a home from one another, they usually do it on some valuation price. Not taking into account, what a stranger might pay for it, or asked to be fixed.
If you’ve ever sold a house, you know what I’m talking about. The last house I sold (which I though was in perfect condition and had been recently renovated) cost me more than $10,000 in repairs before the buyer would go through with the transaction. So if you’re the buyer in this case, make sure to get those items addressed prior to you taking possession of the home, or receive some extra cash from your settlement to fix them later on.
Along the lines of my previous tip, if you have any thought of buying the home from your husband, you need to know if you can qualify for a mortgage. As a stay at home mom, you’re probably thinking “how the heck am I going to do that given that I don’t receive a paycheck for all the hard work I do?” The reality is child support and alimony can both be counted as income when applying for a mortgage. The period of time you need to be receiving payments post-divorce can be as little as 3 months.
A mortgage professional can help you understand what your monthly income needs will be, the mortgage amount you could qualify for, and if a buyout is even realistic in your case. You don’t know how many times as mediator I’ve had a stay at home mom want to keep the house, and have her husband agree, only to have to turn around and sell it because she couldn’t get a mortgage. Not to mention, they needed to go back and re-do their settlement!
Are you a stay at home mom in the beginning stages of preparing for a divorce, and want to get educated? If so, I invite you to sign up for our Planning for a Peaceful Divorce Course!
This course is broken into 14 modules and is specifically designed for women who are in the beginning stages of preparing for a divorce and want to learn things like:
If you're already divorced or are in the midst of a divorce with lawyers involved, you won't get much value from it.
So why did we put this kit together? A little history…
Back when my “stay at home” mom was going through her divorce, she didn’t have the Internet, and the benefit of all of this information. She relied solely on friends, family and her attorney to tell her what to do. Given that her divorce took nearly 3 years to complete, and wound up in litigation, she would have really benefited from this course and been able to make smarter choices. So that’s why we put it together. To help stay at home moms like you avoid what happened to my mom.
Click the link above to register – you’ll be glad you did.
*Please note our website receives compensation for referrals to BetterHelp.
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