Divorce can be challenging and emotional, but it is also a time to be shrewd about your financial situation. Money may not be on the mind of every divorcing couple in Texas, but the most practical way to approach a divorce agreement is to stay level-headed when it comes to your economic circumstances.
Many Texans are not aware of everything they have. The truth is that most people have assets like furniture, a home, a vehicle, investments, bank accounts and pensions. It is in your best interest to start doing some digging about how much you are worth and how much your spouse is worth.
Sometimes, it is a good idea to start with what is owed, since you don’t want to be saddled with bills that could be solely in your partner’s name. Bitter soon-to-be exes may start to hide sources of income. The credit reporting agencies can provide documentation that lists every debt, both shared and individual. Start to pay down your debt, as it will be a way to avoid creditors coming after you for charges your spouse may have incurred.
Start listing big items like child support or alimony. Refer to your tax returns from the past several years. You might be surprised to learn the person you thought you knew may not be what he or she seems.
While taxes can be complicated, they can be more complex during a divorce. Speak with your divorce attorney and financial planner who can provide necessary information about dividing up assets during a divorce.
Keep in mind that all insurance policies must be updated regularly but especially during a divorce. You will want to reconsider having your spouse as your beneficiary. If you have children, a decision needs to be made of who will take responsibility for them and their medical needs.
Car and house insurance policies need to be reviewed for any changes, even though you may already have a will. Depending on the item, certain designations may trump your ironclad will.
A divorce may be emotional, but it doesn’t have to be impractical. There are advisors that can help in the areas of taxes, spousal support, child custody and shared parenting decisions and can help you figure out the best map to your present and future. If you live in Texas, take the time to get help as you delineate your new economic strategy as you move forward after your divorce.
Source: Alice Echo News Journal, “Five financial considerations when you’re going through a divorce” Paul F. Rycroft, Jun. 07, 2014