We all know or have experienced the signs of love and marriage. However, if you and your spouse have been in a negative place for a while, or if something big happened that affected your marriage in a negative way, divorce may be an option on the table. Finances, and going from married to single, is a topic of much importance with clients’ wondering about their financial futures.
The truth is, financial planning for the future beyond marriage happens while you are getting a divorce. This is because the property division needs to be fair and equitable, considering all past, present and future topics relevant to the couple and their divorce. Understanding your personal financial snapshot, in relation to your spouse, will help to determine the specifics of that property division. You may even want to consider what your new (or brand new) estate plan will look like, now that you’ve gone from a couple down to one.
Once your divorce is finalized, there is some cleaning house that needs to be done with an estate plan, will or other document that considers the future. You need to change your power of attorney, as often it was your ex-spouse. Revise that will and trust to update your current change, maybe it would go solely to your kids or your parents, rather than your ex-spouse. Life insurance is often something that gets overlooked during a divorce, but these are items that are made a part of the estate plan, so it’s as good of time as any to revise provisions as necessary.
These are just a few ways to adjust for your financial future. Estate plans can name which assets go to which beneficiary, amongst other goals a person may have for their financial future. Don’t forget to amend any parts of the 401(k). While you may have divided this asset itself during the divorce it may still be set up to transfer to an ex-spouse post-divorce, so dotting your i’s and crossing your t’s can be in everyone’s best interest and ensure a financial future that you planned for.