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Ending a marriage is an emotional decision that can be painful in many ways. Divorce, especially among people over 50, can have a devastating effect on your financial situation. Here are 16 tips to help you make good choices as you prepare for divorce:

1. Avoid the “Scorched Earth” Temptation

When emotions are running hot, you may be tempted to burn it all down. Making financial decisions that hurt you, your children, or your soon-to-be-ex-spouse will not make the divorce any less painful. Just the opposite, in fact. Try to keep a level head and do what is best for everyone in your family.

2. Do Not Rush Your Decisions

It is natural to want to get through the divorce as quickly as possible, but making rash decisions can have lasting negative effects on your finances. Making good financial decisions means taking the time to review the options and limiting the emotionality you bring to the situation. Some financial moves in divorce, once done, cannot be undone.

3. Take Care of Yourself

Divorce is a very stressful time, even under the best of circumstances. Taking care of yourself emotionally and physically will put you in the best position to make good financial decisions for your future. Keep up with regular medical and dental visits. Eat properly and get exercise. Seek the support of family and friends. Consider seeing a therapist for some added emotional support.

4. Get Professional Financial Advice

The best way to make good decisions in the midst of this emotionally charged situation might be with the help of qualified professionals. Seek the advice of an accountant, attorney, and financial advisor before going forward. Look for professionals who are experienced in handling divorces like yours. Remember that financial advisors should be certified or licensed by your state.

5. Review Your Prenuptial Agreement

If you have a strong prenuptial agreement, many of the financial decisions should already be spelled out. A prenuptial agreement won’t necessarily eliminate disagreements over assets. Share your prenuptial agreement with your accountant, so they can draft a separation plan. Talk with your attorney about challenging the agreement in court if you think it is unfavorable to your current situation.

6. Collect Your Information

You’ll need several account numbers and documents to organize your divorce. Collect these pieces of information and have them handy:

• Names, birthdates, and Social Security numbers for you, your spouse, and your dependent children
• Bank account numbers and balances, as well as the name and address of bank
• Credit card numbers and balances, as well as contact information for the bank
• Assets list, including real estate, investment accounts, deposit accounts, vehicles, and anything else of value that you own
• Loans and liabilities list, including any mortgages, home equity loans, auto loans, and other installment loans
• Employment information, including employers’ names, contact information, and length of employment
• Income information, including W-2 wages, 1099s, Schedule K-1 distributions, rental income, and any other household income
• Expense information, including utilities, insurance, and maintenance for your current household along with food, gas, clothing, and other consumable expenses
• Legal documents, including tax returns for the past several years, insurance policies, wills, power of attorney documents, advance healthcare directives, and any other legal documents you executed during your marriage
• Business documents, including tax returns for the past several years, detailed profit and loss statements, balance sheets, and any other business valuations

7. Open New Bank Accounts

If you do all your banking under joint accounts, you will need a new bank account in your name only. Direct your income from all sources into your new account to protect yourself and your money. This move will also help reestablish your own credit history.  

8. Set Up New Email Accounts and Arrange for Mail Delivery

Depending on how long you have been married, it may be difficult to separate the parts of your lives that are intertwined. You will want a new email account that only you can access for new bank documents and correspondence from your advisors. You might want to consider a post office box for confidential mail and a single address if you are between residences.

9. Create a Budget

After the divorce, your financial situation may look different than what you are used to. Start now to create a budget for your new single life. Account for your anticipated expenses and those of your children, if any will be living with you. Talk to your tax advisor about the tax consequences of your new filing status. You may need to set aside money for taxes in your new budget. A budget will also help you save for unexpected expenses and emergencies. American Heritage offers free financial education webinars that cover a variety of topics, including budgeting.

10. Decide What to Do With Your House

For most married couples, their home is their biggest asset. Once you divorce you may not need such a big house or be able to afford the mortgage and upkeep. (Experts recommend spending no more than 30% of your gross monthly income on housing.) Dividing your assets fairly might require selling the house. Check with your team of professionals to understand the different tax implications of selling the house before or after the divorce.

11. Consider Changes to Health Insurance Coverage

If you and your spouse are covered by the same insurance policy, you will want to make some changes. Don’t wait for the divorce to go through and you or possibly your children to be dropped from the policy before seeking new medical coverage. If you are not employed or do not have access to your own employer-sponsored health insurance, you’ll want to begin investigating your options as soon as possible.

12. Examine Life Insurance Policies

Your emergency financial strategies will necessarily change because of the divorce. You may want to keep a term life insurance policy in force for your minor children. A whole life insurance policy will likely include a cash value that you should add to your list of assets.

13. Decide How to Handle Retirement Savings

Part of the divorce settlement agreement is the division of marital assets, including retirement accounts containing funds earned during the marriage, according to the rules of property division in your state. Be aware that withdrawing funds from these accounts if you are not of full retirement age can expose you to additional taxes and penalties. Your accountant or financial advisor should be able to explain your options.

14. Decide How to Pay for Your Children’s Education

Despite your changing marital status, you may still have financial obligations to your children. If they are minors, it is a good idea to decide how to pay for their education now, while you are splitting assets and responsibilities. Establishing a 529 plan that you and your spouse contribute to might be the most equitable solution. If you already have a 529 account, you will want the divorce agreement to stipulate who will contribute to it and how much.

15. Review Beneficiary Designations

Life insurance policies, retirement accounts, and other investment instruments include beneficiary designations. You may no longer want your soon-to-be-ex-spouse to benefit from these accounts when you die. Review all beneficiary designations and decide which ones to change. Some states do not allow spouses to be disinherited, so this step might have to wait until after the divorce is finalized.

16. Get a Copy of Your New Credit Report

After the divorce is finalized, you’ll want to review your finances to be sure everything is in order. Request a copy of your credit report to review all the changes for accuracy. Be sure to check that your new marital status is recorded properly. Moving forward, any financial changes you make—opening new accounts or new loans, for example—should no longer be affected by your ex-spouse, and vice versa.

The end of a marriage can be a stressful time both emotionally and financially. When it comes to finances, the best decisions are made calmly and with positive intentions. It is a good idea to rely on your financial advisor and other professionals in your life to help you through this difficult time.