How to Plan for Divorce When You and Your Spouse Have Very Different Incomes

Divorce is almost always emotionally and logistically complex and when there's a significant income gap between spouses, that complexity can intensify. The lower-earning spouse may be facing not only the end of a marriage but the start of a significant financial transition. For both parties, finding a fair and workable plan often requires careful thought, professional guidance, and even some creativity.

If you're the lower-earning spouse, the financial unknowns can feel overwhelming. With smart planning and the right team of professionals, you can begin to chart a stable, empowered path forward. Below are key steps to consider as you start preparing.

Reenter the workforce sooner than later

Even if you've been out of the workforce for a while, reentering it on any level can be a powerful financial and emotional step. It not only helps build financial independence but may also factor into your case when maintenance (spousal support) is being determined. Starting to earn money, even at lower amounts, shows good faith and provides valuable data for financial planning and court considerations.

The alternative to not finding work means that a vocational assessment can be requested to determine your earnings capabilities based on your education, prior work history, and local job openings that may fit your qualifications. This could be risky if the evaluation comes back higher than what you think is possible. Therefore, getting a job upfront could ease the stress of the possibility of this evaluation. The immediate cash influx to your situation can also drastically help your overall financial situation.

Addressing the elephant in the room

It’s not uncommon to hear, whether in hushed tones or outright advice, that the best financial move at the start of a divorce is to stop working in hopes of securing a higher maintenance award. However, this approach is highly situational and can carry significant financial risks if not carefully considered and tailored to your specific circumstances.

In general, this guidance may not apply if you have young children, children with special needs, your own medical limitations, or if you’re nearing retirement age (typically 55 and older). However, for those outside these categories, returning to work sooner rather than later can have a meaningful impact, not just on your immediate financial stability, but also on your long-term financial health. Early re-entry into the workforce can create more flexibility and options during property division, ease pressure on your current budget, and improve your ability to save for retirement or remain in your home. Additionally, it can help grow your assets over time so that when maintenance eventually ends, you have both investment growth and earned income to support you, reducing the need to liquidate assets too early. Perhaps just as important, it can also help minimize the financial lifestyle shock children often feel during and after divorce.

Be thorough when preparing financial disclosures

When completing your financial affidavit, accuracy and detail matter. Your listed expenses should reflect your current reality as well as your anticipated post-divorce needs. Think beyond today’s costs. Include health insurance premiums, housing expenses (including estimates for a refinanced mortgage or new rental), future childcare, education costs, emergency fund savings, retirement savings, costs of starting a business if applicable (a website, marketing, networking, technology) and anything else likely to shift post-divorce. It is important to both not underestimate your needs and list expenses that can not be substantiated and could be challenged as unreasonable.

Work closely with a CDFA

A Certified Divorce Financial Analyst (CDFA) can help you develop a detailed budget, monitor current spending, and understand what your future financial life may realistically look like. This work is essential to support your request for spousal maintenance and to help you advocate for your future stability.

Understand the maintenance landscape

It’s important to review potential maintenance outcomes with your attorney as early as possible. Colorado's maintenance guidelines (also referred to as a calculator) offer a starting point, but it doesn’t capture the whole picture. For example, the court may impute income to a non-working spouse that is not currently being earned via a vocational evaluation, and not all of your spouse’s income may count for maintenance purposes (especially if it includes bonuses, RSUs, or other variable components).

Define your financial needs 

In many high-income cases, the focus of maintenance could shift from guideline calculations of not just what you’re “entitled” to, but what your financial needs are. A clear and credible post-divorce budget helps demonstrate the reasoning behind your request for maintenance. The more detailed and realistic your budget, the more helpful it becomes in negotiations or court.

Maintenance doesn’t have to be one-size-fits-all. Your attorney or CDFA may explore several possible structures, such as:

• Traditional monthly maintenance
  
  
• A mix of monthly maintenance plus a percentage of future bonuses
  
  
• Lump sum maintenance paid from assets
  
  
• A blend of the above
  
  

Each option has pros and cons, including tax implications and enforceability considerations. It’s key to understand what works best for your situation and your long-term goals.

Consult a CDLP before finalizing agreements

If you need to refinance or qualify for a mortgage after the divorce, it’s crucial to review any proposed maintenance structure with a Certified Divorce Lending Professional (CDLP). The way your income is structured will directly impact your ability to qualify. This step is often overlooked but can have significant consequences.

Navigating divorce with uneven incomes isn’t easy, but thoughtful preparation can make a significant difference. Take the time to understand your financial picture, explore your options, and lean on trusted professionals to guide you. While the process can feel uncertain now, with the right support and a clear plan, you can move toward a more stable and empowered future. Contact us today to learn how we can help.