Once you and your spouse or partner have decided to separate, there are a few financial matters that you cannot afford to overlook. Though a married person may be unable to completely extricate him or herself from a spouse financially until after the divorce, there are a few things that can be done to make the eventual split easier to manage. Creating a financial to-do list after a separation decreases your chances of forgetting to make critical changes that could affect you and your children in the future.
Revise Your Budget
Even if you did not share a bank account with your former partner and kept most financial matters separate, chances are you will still need to make changes to your existing budget if you are facing divorce. Household expenses that your ex used to handle will now be your responsibility and you will no longer receive help paying for certain things such as groceries, utilities, and other shared expenses. Do not count on funds in joint accounts and be prepared to cancel these accounts to avoid your partner acquiring more mutual debt. Revising your budget helps you trim the unnecessary expenses that makes it difficult for you to pay necessities. Cancelling or reducing subscription-based services, adjusting your spending habits to spend less weekly on food, and preparing for other economies help you start saving money before finances become a major problem.
Change Your Estate Plan
Couples often work together to create an estate plan that provides each other and their heirs with financial stability after one spouse or partner passes away. Once a separation occurs or a divorce is inevitable, make changes to your estate plan that reflect your new relationship status. Name your children, parents, or other individuals as your beneficiaries within your will and in any life insurance policies that you currently have. Remember, if you update your beneficiaries within your will but fail to make changes on your life insurance policy, your heirs could run into trouble when they try to collect their inheritances.
Revisit Your Retirement Plan
Now that you are single, it is likely that some of your previous retirement plans have changed. Many couples each set a retirement contribution amount that is partially influenced by the amount of money their partner is also saving for retirement. After a divorce or separation, you may want to revise how much money you are contributing annually. Also, since divorce is often expensive, you may need to plan on recouping any money that was spent during the divorce that you were saving for your retirement. It is a good idea to research how your Social Security will be affected and if you should begin considering safer investment options.
Contact an Attorney
Talking to a divorce attorney before you or your partner has officially filed for divorce is always a good idea. An attorney can explain to you what documentation you should obtain while you and your spouse are still living together and make sure that you do not do anything inappropriate. The team at Vayman & Teitelbaum are prepared to answer all of your pre-divorce questions at our conveniently located Atlanta area offices. Contact us today to schedule an appointment so that we can begin providing you with the legal advice you need.