Going through a divorce or separation can be one of the most challenging and difficult times in any person’s life. And the challenges aren’t limited to emotional or personal ones – a divorce or separation can also present you with a number of serious financial issues that you’ll have to confront. If you ever find yourself in this type of situation, consider using the following checklist to help you navigate the process while protecting your individual finances.
- Get All Your Financial Information Together in One Place. Before you can plan your new independent financial future, you need to take stock of your current situation. Get copies of the financial and account statements together, for both the individual accounts you may have, as well as the joint accounts that you’re named on.
- Open New Individual Checking and Savings Accounts. Your first step is likely to be opening new individual checking and savings accounts for yourself, if you don’t already have them. These accounts will help you build your own individual financial history going forward.
- Open New Individual Credit Card and Brokerage Accounts. By the same token, if you don’t have any credit card or brokerage accounts that are solely in your name, then open those accounts as soon as possible.
- Open New Individual Retirement Accounts. As you begin to follow a new financial path for yourself, you’ll likely need to come up with a new long term financial plan. One of the foundations of any long term plan is your IRA. Consider opening a self-directed IRA with a custodian such as Quest Trust Company in order to maximize your investment options.
- Update Your Medical Directives. Is your ex-spouse named as the person who makes medical and treatment decisions for you if you’re ever incapacitated? In addition to the obvious personal issues you may have with this after your divorce, there can be significant financial impacts as well. Update these medical directives immediately.
- Update Your Beneficiary Information. Your ex-spouse was probably named as your primary beneficiary in your self-directed IRA as well as the retirement plans you may have through your current or former employers. Be sure to update the beneficiary information in all of these accounts as soon as possible. And of course, update the beneficiary information in your will and life insurance policies too.
- Speak With a Professional. If any part of the divorce or separation process leaves you with financial questions, seek out the assistance of a financial professional. Don’t leave this step until the last minute, though. The earlier in the process you can get expert advice, the better.
Keep in mind that this checklist should be viewed as a starting point for your own personal planning. If you’re working with an attorney in connection with your divorce or separation then involve them in the financial decisions you make as part of the process.