The number of personal changes caused by divorce is staggering. It’s hard to keep up with the details of your new situation. Getting control of your finances is one critical piece of this ever-moving situation.
Protect Your Financial Well-Being After Divorce With These 10 Steps
- Make a budget. Are you paying child support? Did you have to sell your house? Look to the future and go beyond your utility bill and rent or mortgage. Doing this will protect your credit rating and give you peace of mind.
- Seek out a new financial advisor. If you had a financial adviser with your ex, think about getting a different one. Find someone you can be fully comfortable with, who won’t have any potential conflicts.
- Change beneficiaries on all your assets. Otherwise, your assets, such as retirement accounts, bank accounts, insurance policies and other assets could go to your ex upon your death.
- Remove your ex-spouse’s name from all the assets assigned to you by the property division process. This could include bank accounts, retirement accounts, brokerage accounts, the mortgage, the lease, etc. You may have to apply for accounts in your own name using your own financial information.
- Come to an agreement with your ex about joint expenses. Put that agreement in writing if that information is not part of your divorce. Things like summer camp, music lessons, horseback riding and college tuition are not usually part of standard divorce agreements. If you and your former spouse agree on these things, write it down and have the agreement formalized.
- Cancel any joint expenses and obligations. This includes joint credit cards, charge accounts, utilities, loans and leases. If you don’t and your ex does not pay a debt or expenses assigned by the court, you can be held liable for that debt because your name is on the account. Open accounts in your own name before you close the old ones to avoid a big hit on your credit score.
- Review your credit report at least annually. If you find something wrong, take immediate steps to fix it.
- Pay down debts as soon as possible. This avoids paying excess interest rates and helps increase your disposable income each month.
- Save as much as you can. Even if it’s only a little bit at first, your savings will add up. If you are currently depending on spousal support, know that it will probably stop sooner rather than later. Figure out what you will need to live without support payments and figure out how to get it on your own. You can also save some or all the spousal support payments for the future.
- Determine which spouse claims the kids at tax time. Your divorce decree should document which parent will claim the children as dependents on taxes. If it doesn’t, clarify this with your spouse. You may want to modify your divorce decree to include this new agreement.
You Don’t Have to Do Everything at Once
If you are still reeling from your divorce, don’t try to tackle all of this at once. Sit down, make a plan, and then slowly start chipping away at it. Commit to making steady progress on getting your financial affairs in order.
Get Help With Your Finances After Divorce
Talk with a financial adviser or contact an experienced Texas divorce attorney for help with your finances after divorce.