Avoiding Financial Mistakes During and After Divorce

 Posted on October 10, 2017 in Divorce

When your marriage is ending, your life will likely be thrown into chaos as you and your spouse work to separate the many aspects of your lives which have become closely linked over the years of your partnership. During divorce, it is important to understand how your finances will be affected and plan for how you will manage your ongoing budget.

Consider the following tips to get on the right financial foot during divorce proceedings and after your divorce has been finalized:

1. Create a budget - You should make sure you have a full understanding of your income and expenses, including any spousal maintenance or child support payments you pay or receive after the divorce. Additionally, be sure you are accounting for rent, utilities, groceries, credit card bills, vehicle maintenance costs, insurance, and child care costs. Setting everything down in a budget and planning month to month management will ensure that unexpected costs do not arise and cause problems in the future.

2. Understand your taxes - Take a look at how your divorce may have affected the taxes you owe, including what deductions you can take and whether you will need to pay taxes on any assets which have been transferred into your name. You may want to consult an accountant to determine whether you need to adjust your withholding or use any other strategies to minimize your tax burden.

3. Set up your own bank accounts - If you have not done so already, you should be sure to open your own checking and savings accounts, as well as credit cards or investment accounts. Make sure that any financial assets granted to you in the divorce are correctly transferred into these accounts.

4. Check your credit report - It is a good idea to obtain a copy of your credit report and address any errors or discrepancies you find. This will help eliminate difficulties that may arise when renting or buying a home in the future.

5. Update insurance coverage - Contact your health insurance provider to make sure your health insurance coverage will not be interrupted and that you and your applicable dependents are the only ones named in your plan. Update your automobile and homeowner’s insurance to ensure that you are the only person on your policies and that they only cover the property that you now own.

Contact an Experienced Divorce Lawyer

By following these tips, you can make sure that you have a clear picture of your finances and are on good financial footing as you move on to this new phase of your life. If you have any outstanding legal issues related to your finances during divorce, the family law attorneys at A. Traub & Associates can help you find a solution. Contact a Schaumburg divorce attorney at 630-426-0196 to schedule an initial consultation.

Sources:

http://www.divorcemag.com/articles/post-divorce-financial-checklist

http://www.divorcesource.com/blog/things-to-remember-make-yourself-a-checklist/