Divorce does not only change your marital status. It also creates significant changes in your financial situation. That is why it is important, even at such an emotional and stressful time, to prepare for a separate financial existence the moment you and your spouse accept that the marriage is over. The five steps below will put you on stronger ground when it comes time to build your new life.
Step one: Hire a divorce attorney
Hire a divorce attorney as soon as you know for sure that you and your spouse will not be reconciling. They will compile the necessary paperwork, represent you in court and work with you to protect your financial assets. It is not unusual in acrimonious divorces for one spouse to either hide money or deliberately max out joint credit cards or lines of credit to leave the other with more debt. If this happens to you, your attorney can present a case that could result in you receiving damages during a settlement proceeding.
Step two: Collect all your important financial documents
Assemble all of your key financial documentation, such as bank account statements, credit card bills, tax returns, and investment details. Not only will all of these be required when it comes time to divide marital finances and liabilities, but you want to make sure that your spouse has not been quietly siphoning away marital funds over the years. If anything looks suspicious, such as a large credit card purchase you donâ€™t recognize, investigate further.
Step three: Get a copy of your credit report
Pull a copy of your credit report from all of the major credit bureaus to ensure that there are no suspicious transactions that need to be disputed. If you are concerned that your spouse might attempt to take out loans or apply for credit in your name, sign up for a credit monitoring service that will notify you anytime there’s a change to your credit profile.
Step four: Establish an independent financial identity
Now the process of establishing your separate financial identity begins. Remove your name from any joint bank accounts, lines of credit, or credit cards and, if you donâ€™t have any of these in your own name, set them up. Donâ€™t forget to remove your spouse as a beneficiary on your insurance, pensions, retirement accounts, and related arrangements.
Step five: Talk to a financial planner
If you have a substantial retirement account and other significant financial assets, speak to a financial planner who can provide you with reliable advice on managing and making the most out of these assets after divorce.
When a marriage ends, it almost always means a considerable change in finances for both parties. Talking to a qualified divorce attorney and following the steps outlined in this article will put you in a better position financially as you move forward. If you are considering divorce, then contact the law office of Jayson Lutzky, P.C. Mr. Lutzky is a divorce and family law with more than 33 years of experience. Mr. Lutzky handles cases in the Bronx and the Greater New York City Area. Visit www.MyNewYorkCityLawyer.com to learn more or call 718-329-9500.