Getting divorced? Protect your finances

Doing certain things during your divorce could save you from extensive financial harm. This being said, even if your divorce seems amicable at first, you should still take care of finances, as with just the drop of a hat, your soon-to-b ex could become irritated and that niceness could turn to bitterness and revenge.

While there are a number of tips for protecting your finances, one of the first things you should do is to separate all joint bank accounts. This will protect you from the possibility of your spouse draining the bank accounts.

Credit protection is also a big one to take care of during the beginning stages of divorce. You cannot just take your name off of credit cards, the mortgage or other credit accounts. Instead, in most cases you will have to refinance or transfer balances. And while this could take time to sort out, it is best to take care of these things as soon as possible to avoid the possibility of your ex ringing up more debt in both of your names.

At this time, it’s also advisable to get copies of your credit reports, and to carefully go over and address any debts that you share with your ex. Of course, these conversations may not be something that you necessarily want to do, but it is important to straighten out all bills, and make sure that both of you have open lines of credit in case there is some kind of emergency.

Now is also a good time to gather advice about filing taxes in the year your divorce becomes final. The year it becomes final, your status will change to single, and you could have a whole new list of deductions and incomes to deal with, like having to pay spousal support.

Additionally, make sure to get your own insurance coverage for things like health and vehicle. Don’t just assume that you’re fine and still on your spouse’s coverage, as she or he may have already taken you off of the policy.

Of course this is not an extensive list of everything you must do to prepare for divorce, but it will at the very least help to protect your finances in the future.

Source: Money Talk News, “4 Steps to Take as Soon as You Say ‘I Don’t’,” Angela Colley, Jan. 4, 2012

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