Divorce is difficult as it is, but it is more important than ever before to look ahead to protect your own financial well-being. You did not plan to get divorced, but it is happening, and you should prepare for a new life. Hard as it may appear, we get thrust into situations that we would rather not be in, and we either swim or sink. Apart from the struggle for the children, financial considerations are the next difficult thing to handle in a new life as a divorcee.
Starting from utility bills which were shared or at least discussed, each person will now get his own for almost the same services. The luxury of carpooling is no longer available, and each person has to make his personal arrangements for transport. The needs of children seem to increase, and because parents feel a sense of guilt, those costs go up too in a divorce.
While you struggle with such apparent issues, this is the time to sort out all other less obvious financials.
You need to change the signatories on any joint accounts you may have or open a new account. Many couples open the joint account to cater for payment of bills and for spousal emergencies. That will no longer be the case, so you need to start to sever your money from that account into a new one, possibly for the same purpose.
Many couples have joint investments. Shares are bought in joint names just as a property is. When things fall apart, before the divorce decree is granted, you need to sit together to discuss the settlement of your investments and who gets what. It is particularly crucial as many times, the surviving spouse or joint owner inherits property that is held in common. It is always better to seek mediation in this kind of matter than to leave it unattended or leave it to the judge, who has no emotional attachment to the ownership of such.
Just like investments, insurance policies need to be separated, and the companies need to know that the insured party is no longer with their spouse.
NEXT OF KIN
Many people state the names of their infant children as their next of kin. This is fallacious. Next of Kin is someone who will be contacted in the case of any emergency at work, or wherever you have given them someone’s name. Many people think that this is to make financial claims against the spouse’s employers, especially in the case of death or severe incapacity. While this may not be the law, a few small organisations will pay money or entitlements to whoever is listed as the next of kin.
Gifts made to a spouse are not defeated because of divorce unless the will is amended. It is only in the event of a new marriage that Will becomes nullified. The intention on the date of the will was for that spouse to inherit the property. Until a new Will is made, the law assumes that the gift remains. It is essential to update your will in the event of a divorce or impending divorce.
Financial considerations give anxiety, and a lack of preparation could lead to a financial loss on many fronts. Why lose your marriage and lose your money? Safeguard it.