The reality of divorce is that your financial life will be different as a single person. However, different does not necessarily mean bad, and by taking a few simple steps recommended by experts, you can help ensure financial health after the end of your marriage.
To avoid potential future liabilities, accounts held jointly with your ex should be closed, and you should open new accounts in your name only. In addition, you should update beneficiary designations on 401(k)s, life insurance policies and living trusts, and you should update your estate plan.
You might be able to save some money by reviewing your insurance policies. Do policies that you are paying for still list items that your ex received in the property settlement? You should not be paying premiums to insure property that you no longer own.
Reassess your tax projections. If you will be in a different tax bracket after the divorce, you may need to change your withholding or payment of estimated taxes. You may also need to change your investments.
Finally, you should prepare a simple home budget following a divorce. You will have different sources of income and different expenses after the divorce. Keeping track and consciously planning will give you a better view of how much you will have leftover to invest and to spend on nonessential purchases.
Adjusting to a new personal financial system may not be the easiest thing. But it is necessary after a divorce, and if you spend some time on it, make the right moves and do everything you can to ensure you get a fair deal financially in the divorce settlement, you can go on to a bright financial future.
Source: Daily Finance, “22 Tips to Transform Your Financial Life After a Divorce,” Robert Pagliarini, July 28, 2014
