Getting a divorce can be a devastating experience, both financially and emotionally. It is a very delicate time of your life, and it can be quite easy to make poor decisions during this time. These decisions can impact your finances for quite a long time. However, if you made sound decisions it can take you a lot less time to financially recover from your divorce.
Fortunately, a lot of the things that you need to do following a divorce don’t involve a lot of thinking. Some of the choices you need to make are easy.
Here are some strategies you can follow after your divorce to get your finances back in order:
Close any joint bank accounts that you have and open a new one for yourself.
If you are in the process of getting a divorce, you don’t want to be responsible for any financial liabilities that may be created by your soon-to-be former spouse. Bank accounts are not the only thing that is included. Credit cards can potentially cause a lot of problems as well. Contact your credit card companies and bank to inform them of your situation.
Any new accounts that you open should be in your name only. It may be easier to do this before you close your joint accounts. Just make sure you will have access to access throughout the entire divorce process.
Take your housing situation into consideration.
If you have children, it does complicate matters. Otherwise, it might be easier to just sell your house and move on. If you do have kids, the best thing to do is usually to consult with your attorney to figure out what your options are.
Determine what all of your assets are.
Are you aware of what all of your financial holdings were while you were married? In many situations, one spouse manages the family’s financial matters, while the other spouse is happy to not be involved.
It’s time to do some digging so that you can get an accurate picture of everything you own. You may be surprised at all that you find.
You will need to decide collectively how assets will be handled. Will you split them? Will you sell them first and then share in the proceeds? Or will you battle it out and hire lawyers?
Consider your insurance needs
You may need to get a medical insurance plan for yourself. What things do you own still that will need insurance coverage? Your current insurance costs might be a lot lower than they will be. Just be sure not to carry more insurance than is actually needed.
Since there has been a change in your situation, it is likely that your insurance needs have changed also.
Make a budget for yourself.
Your expenses and income have changed, so you will also need to change your budget. If you have changed from a household with two incomes to just one, you won’t have as much margin for error. Come up with a budget that fits your new situation.
Change the beneficiary on your retirement and life insurance accounts.
Your spouse was probably your beneficiary on these accounts, so you will most likely want to have new beneficiaries listed. Usually you can do this by simply filling out a basic form. Many people overlook this step.
Make sure that your assets will go to the right individuals in the event that you die.
Obtain copies of your credit report.
It is very important to be aware of what your financial status is. You also need to know what all your assets are. It’s possible that your spouse could have opened a credit card or joint account without you knowing about it. The better that your credit is, the easier it will be for you in many different aspects of life.
Divorce is a very hard time for everyone involved. However, a divorce can be particularly difficult if you don’t handle your financial matters in a smart way. If you focus on your assets, income, debt and housing your transition will be a lot easier.
The above tips cover all the basics. You will most likely need an attorney. However, it will be easier for you to make smart decisions if you understand the main issues. Apply the strategies to your situation and obtain the professional assistance that you need.