How To Prepare Financially For A Big Breakup Or A Divorce
How To Prepare Financially For A Big Breakup Or A Divorce

How To Prepare Financially For A Big Breakup Or A Divorce

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Facing divorce or a breakup with your partner? Maybe you’ve talked to a lawyer and are ready to have your spouse served with the papers. Perhaps the two of you decided through respectful agreement to consciously un-couple. Or maybe you’ve been miserable for years and are exploring your options. 

No matter where you are in your breakup journey, there are some core financial considerations to tidy up now, so that you and any children you have are protected if and when you call it splitsville 

1. Get informed about your own financial picture  

Each breakup is unique, and your new financial picture as it relates to your soon-to-be ex depends on lots of factors, including who earns more, whether there are children, if you are married or not, and whose name is on assets like a home and retirement investments —  as well as any debt.  

If you don’t already, pull all the financial information you can about both yourself and your partner or spouse. Compile these documents: 

  • Tax returns for all parties for the past 3 years  
  • Employment records  
  • Mortgage statements  
  • Property tax statements 
  • Car loans  
  • Credit card and other debts  
  • Bank statements, including checking, savings, CDs 
  • Retirement accounts, including accounts from before you were married  
  • Brokerage accounts  
  • Life insurance statements  
  • Proof of children’s expenses, including health insurance and health care expenses, day care / camp, after care, extracurricular activities 
  • Children’s savings and college investment accounts  
  • Social security records 
  • Trust and estate records 

 2. Open your own bank accounts  

While any joint bank and brokerage accounts may be frozen until you come to a legal agreement, it is not uncommon for one party to clean out any checking and savings accounts, leaving the other without funds for a new apartment, attorneys fees, or food. Even if both if you stay on the up-and-up, it is very common for divorcing couples to fight bitterly over money during a breakup.  

To ensure your own security, and minimize squabbles, open bank and checking accounts in your own name. Start depositing your paychecks and other income into the new account. Avoid taking money out of a joint account, as doing so can complicate any negotiations.  

3. Pull your credit score and credit  history  

A strong credit score is one of the most powerful tools in creating a positive, post-breakup financial future.  

The difference between a 650 credit score, and a 750 credit score can be the difference between affording to buy a much-needed car post-divorce, qualifying to rent an apartment in your own name (vs having to stay with your parents or a roommate), and whether you can afford to refinance your home in your own name. A strong credit score can also help you qualify for a new job, and even be attractive in romance (42% of respondents to a recent Bankrate survey said that credit scores could be a deciding factor in dating).  

TransUnion is an accurate, secure way to pull your full credit history and score. This is critical to your financial, post-divorce future for several reasons. 

To start, the credit report may reveal open accounts that you were not aware of — like accounts fraudulently opened by a stranger, or secret financial activity your partner kept from you. Delinquencies, errors and other items that ding your credit score will also be revealed.  

Knowledge is power. The more you know now, the better you can negotiate your divorce, as well as remedy any errors.  

Keep in mind that divorce can affect your credit — at least in the short-term. For example, once you remove your name from a shared credit account like a mortgage, or credit card, your score can dip since that credit history is now removed — not to mention the credit-usage ratio is lower.  

 4. Decouple joint credit accounts  

It is critical to get your name off any joint debt, starting with credit cards. If both your names are on an account, and your partner does not pay the monthly statement, or racks up additional debt, that will affect your credit score and history, and you are likely legally responsible for that debt. 

To protect yourself:  

  • Close any joint accounts.  
  • Remove your name as authorized user on the other person’s account — and remove them from any of your accounts  
  • Open an account in your own name only  
  • Set up automatic payments from your own personal checking accounts to make sure they are paid on time, and ideally in full  
  • Pay close attention to other debt, like a mortgage, car and personal loans, to ensure they are also paid on time. 
  • Keep an eye on your credit score and report, and take quick action if suspicious activity pops up. Divorce and breakups top lists of most vulnerable times for financial fraud, by both people you know as well as strangers — since there is often an unusually high number of financial transactions taking place. 

5. Focus on increasing your income and savings

No matter what your divorce settlement looks like, or how much you and your partner earn today, your post-breakup life will likely to be financially tight — at least in the short-term.  

After all, you now have to maintain two households on the same income that supported one household. You will likely see your long-term investments and savings be reduced, and you’ll be eager to play catch up. Additionally, divorce and breakups usually require expensive attorneys, relocation, down-payments on a new home purchase or rental, and other new-life expenses.  

Unfortunately, there is a lot incentive for co-parents and divorcing spouses to reduce their income — as this can increase the sum of child support or alimony you are owed, or lower the amount you are required to pay. 

This sort of maneuvering only heightens the acrimony now, and lowers your financial and personal wellbeing for the rest of your life.  

Despite what your lawyer may suggest, or your friends urge, take the high road and focus on growing your career and income. Double-down on frugal living, create a budget, and then put your energy and time into building your career, starting that side gig you’ve been dreaming about, or boosting your business’s profits. Build up emergency and long-term savings, and invest for a healthy retirement.  

This positive momentum will have lasting financial benefits to you, your children, and maybe even your relationship with your ex — and focus your energy on a positive new future.  

Save more, spend smarter, and make your money go further

Emma Johnson
Emma Johnson

Written by Emma Johnson

Emma Johnson is a financial journalist, author of the bestselling Kickass Single Mom (Penguin), founder of, and founder of — the world’s largest platform for single mothers. As an expert she has been featured in the New York Times, Wall Street Journal, O, the Oprah Magazine, CNN, The Doctors and hundreds of other outlets. She lives in New York City with her children. More from Emma Johnson