First Financial Steps
After a divorce, many people have some financial housekeeping to do in order to move on as a single and now financially independent individual. Here are a few steps to get you started:
If you’ve changed your name in your divorce, you will need to update all your bank accounts, credit cards, and, of course, the Social Security Administration. This should be your first step.
Next, you will want to close any remaining jointly held accounts. For credit cards and loans, you may have to pay off the account to close it. For deposit accounts, you should transfer your funds into a new account. For any accounts you cannot close, remove your spouse’s name and change the contact info for the account. The point is to remove all financial (and therefore legal) ties to your ex. This is great for helping you move on but also minimizes your financial liability post-divorce.
If you haven’t already addressed it in the divorce, you may need to obtain health insurance coverage if you will be dropped from your spouse’s. Since this can be a significant expense, it should be worked into your budget.
Make sure any retirement account QDROs have been filed. This process often takes months after a divorce to finalize. Meanwhile, you could be missing out on accrued value. Make sure your QDRO attorney has all the information needed to divide your plans and consult with your plan administrator for guidelines on how your particular plan will be divided.
Update your estate plan including your will and any life insurance policies. You will need to name a new beneficiary. Your spouse will remain the beneficiary on any policies even if you divorce.
While you’re updating your estate documents, get a long-term financial plan in order. Knowing where your income will be coming from, what expenses you have, and where you want to be financially in the future can help guide your financial choices immediately following a divorce. Speak with a financial planner and a tax advisor to make sure you are on the right track.
If you are concerned about your financial future, consider working with an experienced Massachusetts divorce mediator. A mediator can help you and your spouse effectively plan for your financial futures while preserving the assets you have.
Are you concerned about your finances post-divorce? Mediation Advantage Services can help. Experienced in divorce mediation, Polly A. Tatum can help you prepare and plan for your financial future. Based in historic Worcester with a satellite office in Northboro, MA, our firm serves all cities and towns throughout Massachusetts and Worcester County including, Auburn, Paxton, Leicester, Sutton, Grafton, Shrewsbury, Westboro, Northboro, Southboro, Holden, Sterling, Princeton, Worcester, Charlton, Millbury, Dudley, Spencer, Brookfield, Sudbury, Natick, Framingham, Hopkinton, Milford, Blackstone, Leominster, Fitchburg, Acton, Jefferson, Barre, Oakham, Cambridge, Newton, Marlboro, Lancaster, Bolton, and Hudson. Call our office at 508-795-1557, fill out our online form, or email us at email@example.com today to schedule your Complimentary Mediation Success Planning Session. You can also sign up for our eNewsletter or download our free e-book for more information regarding divorce in Massachusetts.