Those about to divorce need a plan of action if they are to get through the divorce with their finances intact. Read on for some tips for not just surviving your divorce financially but thriving afterward.
Know About Marital Debt and Property
Understanding what marital property and debt are and are not can be the key to advocating for yourself. Here are some pointers:
- Marital debt covers joint and single debts taken on after the date of the marriage.
- Marital property is about the things you bought or attained during the marriage.
- Not included in the marital property are inheritances, gifts to one of the parties, and prizes or gambling winnings.
Make Some Lists
Your divorce lawyer can help you sort out what is marital and what is separate debt and property. Make a list of everything for your lawyer. Don't just include items like real estate and vehicles, but also list bank accounts and retirement accounts.
Be Aware of Qualified Domestic Relations Orders (QDRO)
Speaking of marital property, certain types of retirement plans are considered as such. Whether you live in a community property state or an equitable distribution state, things like a 401(k) go into the marital bucket and both parties are entitled to take from that bucket. To accomplish that without having to pay any penalties, your lawyer will need to file for a QDRO early in the divorce process. It needs to be done before the divorce is final.
Get Your Finances Separated
As you begin to live under separate roofs, you should also separate your checking, savings, and other accounts. If you have joint accounts, get your own and stop using the joint ones. Try to pay off any joint credit cards and let your lawyer know if your spouse is going on spending sprees using joint credit. A restraining order can prevent that. You don't want to be responsible for any post-separation spending.
Get Your Documents in Order
If you have access to things like your spouse's banking and other accounts, that might end once they consult with a lawyer. However, you may need to access important documents and information so do some copying and scanning before it's too late. You will probably need copies or scans of the following things:
- The last several years of income tax filings.
- Real estate deeds, vehicle titles, bills of sale, and paperwork from large purchases.
Find out more about any of the above by speaking to a local divorce law firm like Mobile Divorce Law Firm.