Divorce is more than just an emotional decision; it’s a financial turning point. In India, it can be a costly process, affecting your life for years. According to a recent survey by 1 Finance Magazine, 51% of divorced men and 84% of divorced women spend over ₹5 lakh on legal and maintenance fees. What's more, 42% of men have to borrow money to cover those costs.
This means that being financially prepared before filing for divorce can make all the difference between securing your future and facing a long period of financial struggle.
The divorce process in India is notoriously slow and expensive, with proceedings dragging on for years. The longer the case continues, the more money you spend on lawyer’s fees, court costs, documentation, and sometimes even maintenance. And every month of delay only adds to this financial burden. That's why being ready before you file for divorce is crucial — to avoid unnecessary stress and minimise long-term financial strain.
Before filing for divorce, gather all the documents that detail your financial situation. This includes your bank statements, tax returns, payslips, credit card bills, insurance documents, loan details, and any retirement or investment accounts. Don’t forget to document all property and real estate you own, including deeds, titles, mortgage records, and tax receipts. List all your sources of income, whether it’s from a salary, business, rental income, or investments. Also, ensure your account for every asset, from cash and bank accounts to jewellery, vehicles, and stocks. If you're a woman, make sure to identify your personal property that belongs to you alone and isn’t part of marital assets.
Once you have all your financial information in order, start separating your finances from your spouse’s. Close or freeze joint accounts to avoid any unexpected withdrawals. It's important to consult a lawyer before freezing an account to avoid alerting your spouse prematurely. Once you’re ready, transfer your share to your personal account.
If you have joint credit cards, contact the company to freeze them. Missed payments on joint cards can impact both your credit scores, so it’s important to take immediate action.
When it comes to assets, make sure to distinguish between personal property and marital property. Pre-marital assets or those received as gifts or inheritance are usually considered separate property and are typically not divided in a divorce, but you must keep detailed records to protect them. Keep receipts, appraisals, and purchase documents, especially for properties, investments, or gifts you received before marriage.
You should also update your estate planning documents. Change your will, power of attorney, healthcare directive, and beneficiary information. If you have life insurance or retirement accounts, make sure to update the beneficiaries to avoid them going to your spouse by mistake.
Before filing, consider how much you’ll need for your post-divorce life. Calculate your living expenses, child support (if applicable), and how much alimony you need to request. Understand that alimony payments can be either lump-sum or periodic, and figure out which option works best for your financial stability. Many people overlook the costs of healthcare or child support, so include these in your calculations as well.
Once your divorce is finalised, it’s time to create a post-divorce financial plan. Start by reassessing your budget based on your new situation, ensuring you’re on track to meet your long-term goals. This includes revisiting investments, retirement planning, and considering career opportunities that could increase your income.
Also, review your insurance coverage, health plans, and any changes to your legal or financial obligations. It’s important to ensure your financial security post-divorce is as strong as possible.
Divorce can be an emotionally challenging and financially draining process, but by being proactive, you can safeguard your future. Start preparing early by understanding your finances, separating assets, and planning for long-term security. Work with a financial advisor and legal expert to ensure you're making the best decisions for your post-divorce life.
