Is it a bad idea to divorce in a recession like this?

Issues:

House: You need to sell or refinance the house to remove the other spouse from the mortgage, but the housing market is at an all-time low, and financing is difficult even for those with good credit.

Assets: All of the accounts are 40% of what they were; how do you divide the assets fairly when everything is down?

Spousal Support: One party has had to take a pay cut or even lost his or her job.

Bills: You will potentially need to afford two households instead of one.

Cost: Divorce can be expensive. Attorney’s fees are high, and the stress of economic hardship could lengthen the process.

Solutions:

House: Try to refinance the mortgage at a lower interest rate. If you are denied, contact your lender to see what your options are. If you want to stay in the house, contact a divorce financial planner to see if you can afford it. If you’re open to selling, explore the possibility of a short-sale.

Assets: Try to negotiate a way to hold on to assets, rather than selling, until the market improves.

Spousal Support: Instead of waiving your right to spousal support altogether, try to negotiate a tiered scale based on future economic improvement.

Bills: You must know where your money is going! If you don’t, track all spending for at least three months (try Quicken). Cut expenses, i.e. give up the expensive lattes and stop eating out. Also prioritize spending. Don’t let your health insurance lapse due to poor planning.

Cost: Try mediation. Its focus is communication, and it is less expensive than litigation.

Be proactive. If you decide to wait until the dust settles and the economy turns up, take this time to prepare. Consult a divorce financial planner to start laying the groundwork, so you’re in the best possible position when you are ready to take that step.

Nicole Brucker is a Certified Financial Divorce Practitioner and the founder of The Sapient Solutions in Evanston, IL.