When most couples marry, they truly believe that their union will last forever. However, the reality is that around half of the marriages in the U.S. end up in divorce. Although divorce can be taxing emotionally and psychologically, you still need to maintain a certain amount of composure in order to deal with the financial consequences of the divorce process. There are many moving parts and different aspects to consider when planning your finances around a divorce. 

Property division 

One of the first areas that you will need to start thinking about during a divorce is how to divide property and assets between you and your spouse. It is usually preferable if the divorce is amicable and both parties are able to negotiate openly in order to decide who will keep what property. However, if there is a disagreement on specific assets there are various methods you can employ to resolve the conflict. You can try to barter with your spouse and offer to give your spouse one asset in exchange for another asset. Another way to deal with property division disagreements is to agree to sell the marital property and then split the proceeds evenly or in another agreed upon manner. 

Community vs. separate property states 

On the other hand, if the divorce becomes contentious and no agreements can be reached on how to divide property, you will need to settle the divorce through the courts. This means property division will be subject to your state’s specific laws. Generally, there are two types of state laws when it comes to dividing marital property: community property and separate property states. 

Community property states consider all property acquired during the marriage, regardless of whose name it is under, as half-owned by each spouse. This means even if the car and the house is in your name, if those assets were acquired while you were married, your spouse may have a legal claim to partial ownership of those assets. However, each situation is different and there are some states that allow spouses to argue why he or she should be given more than half of the marital assets. Alternatively, separate property states consider property in your name as your own property. 

Dividing debt 

Just like dividing property, divorce will also require dividing the debt owed to creditors. Divorcees will need to decide who will take responsibility for which debts. This will require you to first collect all of the current information on the debts owed so you can see exactly how much is owed. Make sure to run a credit report which will show exactly what debts are in your name and which are in your spouse’s name. 

Plan for the financial future 

When negotiating the financial aspects of a divorce it is a good idea to take stock of your current financial circumstances. This will help you determine what financial objectives you should prioritize. Note that after divorce your tax liabilities and personal budget may change significantly from what they were before. You will need to have a clear picture as to how to navigate your finances after your divorce has been completed.


Raymond James and its advisors do not offer tax or legal advice.  You should discuss any tax or legal matters with the appropriate professional. 

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation.  Any opinions are those of the author and not necessarily those of Raymond James.