Financial tips for those going contemplating a divorce

Whether in Texas or any other state, the end of a marriage can be exhausting. The division of assets could prove to be an overwhelming task and some tips could prove helpful for getting those marital finances in order.The first step is to start putting together all necessary information. A good start is to copy tax returns for the last five years. It’s important to foresee the possibility that the most honest person could try hiding income and assets. As a soon-to-be-ex, it is imperative to enter into divorce by first documenting total assets and investments.

Understanding the tax implications of divorce is an all-important second step. Division of assets can be very complex and often does not result in fair split. Prior to this process, consulting a divorce attorney or other financial adviser is an excellent idea. Assessing overall debt and finding out whether a spouse has accrued any undisclosed new debt are also important. Credit reports should be obtained from Trans Union, Experian and Equifax to determine which debts are shared and which are not.

Establishing a firm foundation for the post-divorce future is a significant step as well. Prior to the divorce, it is important to acquire a personal benefits and earnings statement from the Social Security Administration. A spouse’s information may not be available once the divorce is final. Having a separate bank account and credit in one’s name only are also important.

Last but not least, remembering to update insurance coverage is also crucial. The other spouse’s name should no longer be on one’s dental or medical insurance, nor on any other formerly joint policies. This is also the time to decide whose policy the children should be on and to update the beneficiary designations on all investments and policies.

Source: The Courier of Montgomery County , “Financial items to consider during a divorce“, June 21, 2014