Taking Control of Your Finances After a Divorce
Getting a divorce is very stressful for everyone involved, putting an end to future plans and disrupting your finances. However, there is good news once you reach the end of this long process—you have the chance to start over and create a new future that centers on your goals and dreams.
As you start to plan for life after divorce, make sure you are taking the right steps during divorce. Call Kirk Drennan Law at 205-803-3500 to set up a consultation today.
Adjust Old Accounts or Start New Accounts
Whether or not you and your ex-spouse commingled your finances, you should go through each one of your financial accounts and ensure that they do not have access. Depending on the nature of the divorce, you may want to go one step further and actually close your current accounts before opening new accounts at a different bank. While removing your ex-spouse from an account should prevent them from getting access, sometimes bank tellers can be talked into giving someone access because they have the same last name or were one time on the account.
Check Insurance Policies and POA Paperwork
Go through every single insurance policy and retirement account you have. If you forget to change your beneficiary on any of these, you could be giving your ex-spouse a large payout should you pass away. Make sure you change all of these accounts to benefit those you actually want your funds to go to after you die. Similarly, if you have any power of attorney paperwork that would go into effect if you became incapacitated, ensure that you name someone else in this paperwork.
Run Your Credit Report and Do So on a Regular Basis
Before the divorce is finalized, run your credit report with all three credit bureaus. Look for unfamiliar accounts or unusually high balances. Unfortunately, it isn’t uncommon for a spouse to open secret credit cards or lines of credit in the months leading to a split. They may even take rarely checked credit cards and run up the balance, hoping you don’t check them in the interim. If anything suspicious has happened, you absolutely need it addressed before the divorce is finalized.
After the divorce is finalized, continue to check your credit report periodically. This is just good general financial advice, not even specifically for those who have been divorced. You want to ensure that none of your ex-spouse’s credit cards or lines of credit unintentionally show up on your report or drag your score down.
Set Up Automatic Payments
Your credit may take a hit after divorce if you fall behind on bills during the divorce. This isn’t uncommon; the costs of divorce plus the sudden drop in household income can be difficult to get used to. However, it’s time to get back on track once the divorce is finalized. Put your bills on autopay to avoid late fees and dings to your credit score and figure out a good budgeting system that works for you. While some people prefer good old pen and paper, many enjoy the convenience and ease of budgeting apps. Choose a system that requires minimal work and is easy to follow.
Develop New Financial Goals
Perhaps you and your ex-partner didn’t have clear financial goals, or maybe all of your goals centered on your life as a couple. Either way, it’s time to think about what kind of life you want long-term and what it takes to achieve that. Maybe this means putting more money in your retirement accounts, going back to school for more education, or starting that new business that has always been in the back of your mind.
This is the time to shake off the pain of the divorce and step into your potential as your own person. Take full advantage of it and make your money work for you.
Contact Kirk Drennan Law Today
Divorce isn’t easy, but with the right attorney, it can at least be less stressful. Let the team at Kirk Drennan Law help. To learn more about our options and start working toward this next chapter in life, call us at 205-803-3500 or get in touch with us online.
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