Coming out of a divorce involves a lot of organization while you’re likely feeling down, including deciding what to do about childcare and living situations. Another looming thing you must navigate is you and your ex-spouse’s finances.
Managing finances is never an easy task to take on, but a divorce further complicates the process.
Instead of letting emotions take over how you deal with the financial side of divorce, here are some productive ways you can handle it.
Always Think of Both Parties
Especially if the relationship ended badly, it can seem impossible to keep things civil and unbiased. While you may be angry with or distrustful of your ex-spouse, you need to consider both of your needs.
Going forward, you’ll both have your separate lives to lead. You should make financial decisions that will benefit both of you in the long run.
Keep Things Between You & Your Ex-Spouse
While it may be tempting to tell a coworker or friend what has been going on, it’s best to keep things between you and your ex-spouse. Keep the details of your situation confidential and private to avoid unnecessary complications.
You shouldn’t heed the advice of anyone but a legal or financial professional. These individuals are unbiased and will help you understand the intricacies of certain laws in your state.
For example, Nevada divorce laws state that an alimony decision can be modified if the paying spouse’s income changes by 20% or more. This is an important rule to understand when considering the long-term financial security of the spouse receiving payments.
Close Joint Credit Accounts
Once you and your ex-partner separate, you should not accrue debt in both of your names. Close all joint credit accounts so you don’t damage both of your credit scores and add more burdens to the divorce.
Instead, focus on establishing your own credit. You may lose some of your established credit by removing your name from joint accounts, so start the rebuilding process early.
Update Your Records
Update information on your will, life insurance policy, and retirement accounts. If your ex-spouse was a beneficiary for any of these financial vehicles, make the appropriate changes to reflect your new wishes.
Obtain Your Own Health Insurance
In a lot of cases, one spouse is the main policyholder for a health insurance policy for the entire family.
When you get divorced, you’ll have to find new coverage on a separate policy.
If your employer offers health insurance, ask about when the next enrollment period opens up. If your employer doesn’t offer health insurance, you should research individual health insurance options.
Take Charge of Your Own Finances
In a marriage, one spouse commonly takes the reins when it comes to paying bills, filing annual taxes, and keeping track of the family’s budget.
If you were not this spouse, you may have little knowledge of how to manage your finances. Take initiative and educate yourself on how to handle your money. Establish good relationships with a banker, professional tax preparer, and certified financial planner. These professionals can help you understand your current financial situation and prepare for the future.
Even if you were the ringleader of your marriage’s finances, you should prepare yourself for an adjustment period. Your finances will look vastly different without your ex-partner in the picture. For example, you’ll have to file your taxes separately rather than jointly.
Figuring out finances can add stress on top of a divorce if you don’t navigate the process properly. You have enough to deal with, so follow this guide to make it as seamless as possible.