Divorcing...Now What?

I’m not a social scientist so I don’t know how many marriages end in divorce. I do, however, know quite a few people who have been divorced. Besides the emotional issues, there are a number of issues on the financial side to deal when going from “us” to “me”. Always remember, the one person you can rely on financially is you. So I thought it would be helpful to come up with a checklist of things to do:

1. Separate your credit. First, list all your loans and credit card accounts, jointly and individually. Know your balances due and keep making required payments through the divorce. Even if your spouse is responsible, late payments can affect your credit history. Untangling marital credit can be complicated. You may also want to call your creditors and ask them to close joint accounts or remove an authorized user from your individual account.

2. Understand all your paperwork. You may have relinquished control of combined assets, accounts, retirement plans, insurance policies, debt, etc. to “hubby” when you were married, but it’s time you take control and make an inventory of everything financial. And don’t forget to:
a. Change beneficiary information insurance, retirement and pension plans.
b. Change wills, insurance, trusts, estate planning documents to reflect your current situation.

3. Create a financial plan. Tonka Beans or numerous other websites can help with where to begin and what to do. See my blogs and videos on the following subjects:
a. Create a budget – know exactly what your sources of income and spending are.
b. Establish an emergency fund
c. Figure out how much you can save every month and start saving it.
d. Determine your asset allocation and start investing. This is a big, but not necessarily complicated subject. See my blogs on How to Invest and Index Funds amongst others for some tips.

This is just a brief, high-level, look at what you should be thinking about. As with anything, knowledge is power, so the more research you can do, the empowered you will you be.