Navigating Divorce In Uncertain Times: Financial Planning Tips

Divorce is never easy, but going through one during a time of economic or personal instability can make things feel even more overwhelming. Whether you’re facing job loss, inflation, market volatility, or other financial uncertainty, divorce can quickly compound the stress and uncertainty in your life.

As such, it’s imperative to approach divorce with a clear financial plan. Strategic decisions now can prevent costly mistakes later and help you rebuild a more stable financial future. Here’s an overview of the practical financial planning tips for getting through divorce in uncertain times.

Understand Your Financial Picture Early On

The first step in divorce planning, especially during economic uncertainty, is knowing exactly where you stand financially. It’s common for one spouse to be less informed about the couple’s finances, but now is the time to catch up.

Start by gathering:

• Bank and investment account statements
• Mortgage and loan documents
• Credit card balances
• Pay stubs, tax returns, and retirement account summaries

If assets are difficult to trace or your spouse controls most of the financial information, your divorce lawyer and financial advisor can help uncover and organize records.

Economic instability can cloud your financial picture—changing job status, fluctuating income, or falling asset values can make it harder to determine your true net worth. You will want to document everything now. The more information you have, the better decisions you can make when it comes time to divide property and plan for your post-divorce life.

It’s important to note that alimony plays a role in only about 10% of U.S. divorces. Most people must rely primarily on their income and resources after separation. Additionally, tax laws changed in 2019: alimony is no longer tax-deductible for the payer nor taxable for the recipient. This shift has significantly impacted how couples negotiate financial settlements.

Be Strategic About Property & Asset Division

Not all assets are created equal. While it’s natural to focus on high-value items like the marital home, it’s more important to weigh each asset’s liquidity, stability, and long-term impact on your finances.

The family home may offer emotional comfort, but it often comes with ongoing maintenance and tax obligations. Retirement accounts, though substantial, can carry penalties if accessed early. Investment portfolios may appear valuable, but are vulnerable to market volatility. Rather than looking solely at face value, consider whether an asset is sustainable, easy to liquidate, or aligned with your financial goals.

A divorce attorney, in collaboration with financial professionals, can help evaluate your assets and structure a division that supports your financial well-being after divorce.

Studies reveal that 1 in 4 divorcing individuals admit to hiding assets, with men twice as likely as women to do so. This could include undisclosed bank accounts, business income, or digital assets. To safeguard your future:

• Request full financial disclosure

• Consider working with a financial expert or forensic accountant

• Keep detailed records of joint and individual accounts

Transparency and diligence can prevent unfair settlements and protect your long-term stability.

Reevaluate Joint Debts & Liabilities

While property division is important, don’t overlook shared debts, which can pose serious financial risks while navigating divorce during uncertain times. Rising interest rates, job instability, or changes in credit conditions can quickly turn manageable debt into a burden.

Start by:

• Identifying all joint accounts and loans (credit cards, mortgages, car loans, personal loans)
• Closing or separating joint accounts as soon as possible
• Refinancing loans to remove one party’s name, if possible

Even if a divorce decree assigns a debt to your spouse, lenders don’t recognize that order—they will still hold both parties accountable unless the account is officially changed.

Protect your credit by ensuring debts are divided and monitored. One missed payment by an ex-spouse on a shared account can damage your score for years to come.

Plan For Child & Spousal Support During Volatility

If your divorce involves child support or spousal support (alimony), financial uncertainty can make negotiations more complex. If either spouse experiences job loss, pay cuts, or inconsistent income, courts may need to consider alternative arrangements.

When drafting support agreements, consider including:

• Contingency clauses for job loss or disability
• Review periods to adjust payments if income changes significantly
• A clear timeline for when and how support ends or is modified

If you’re paying support but lose your job, you can’t simply stop making payments—you must petition the court for a formal modification. Similarly, if your ex’s circumstances improve, you may be entitled to request a reduction or termination.

Clear, flexible agreements with court approval are essential to avoiding future legal disputes and maintaining financial stability for both parties.

Rebuild Your Financial Future

Divorce can feel like starting over, but that can also be an opportunity. Once the legal process is complete, take the time to rebuild with purpose.

Start by revisiting your:

• Estate plan: Update wills, trusts, healthcare proxies, and powers of attorney.
• Beneficiary designations: Remove your ex-spouse from retirement accounts, life insurance, and bank accounts.
• Emergency savings: Set a goal for 3–6 months of living expenses in a separate account.
• Long-term financial goals: Retirement, home ownership, college savings.

You may also need to adjust insurance coverage, especially if your ex-spouse carried the health or life insurance for the household.

Work with a financial planner to reassess your risk tolerance, rebalance your portfolio, and align your finances with your new life goals. Even small, consistent steps can lead to significant progress.

Seek The Right Professional Guidance

No one should have to face divorce alone. Having the right team in place can provide the guidance and clarity you need to make informed decisions. A knowledgeable divorce lawyer will protect your legal rights and help you understand the court process. A financial planner or certified divorce financial analyst (CDFA) can assist with budgeting, asset division, and future planning. Tax professionals ensure you understand how your financial decisions may affect your tax obligations. With trusted advisors, you’re more likely to avoid emotional pitfalls and make strategic choices that support long-term financial stability.

How Modern Family Law Can Help

At Modern Family Law, we know that divorce during uncertain times can feel especially overwhelming, which is why we’ve built solutions to help you move forward with greater confidence. Our SimpleStart™ program allows you to reduce your deposit with a simple credit check, easing the financial burden of getting started. We also welcome third-party payers, such as family or friends, to contribute to your legal fees without accessing your confidential case details. In Colorado, our Licensed Legal Paraprofessionals (LLPs) offer affordable support for uncontested family law matters. No matter your financial situation, our flexible fee structures and compassionate legal team are here to help you navigate life’s challenges with stability and support.