| Major life transitions, such as a divorce, are very traumatic. Not only do you need to work through the emotional turmoil, but you must carefully review your financial situation to be certain your current and long-term financial needs are adequately addressed. It's a fact: The only ones who profit monetarily from divorce are lawyers. You must review your insurance policies to be certain they address your current life situation. You must be certain you understand your retirement program to be confident you'll have what you need in your retirement years. If you've recently completed a divorce, or are currently going through the process, be sure you have the proper protections in place to get your fair share of the retirement pie that was built during the marriage. Here are some issues you need to review during these difficult times of change as well as steps to protect your money at this crucial time: | First evaluate where you stand... | Then plan your financial future... | - Review your budget and be certain you can meet your monthly expenses or find ways to cut costs.
- If you don't have a credit card solely in your name, open one. Here are ideas for reestablishing credit.
- Be sure you have a clear understanding in writing about who is responsible for what debts. Protect yourself by getting your name off any loan or credit card that your spouse will be paying.
- Do you need to refinance a mortgage to put it into your name only? Be certain you understand the mortgage options.
- Do you understand your retirement plans as well as those of your ex-spouse? If you have not worked outside the home, be sure your divorce agreement spells out your share of your spouse's retirement and how you will collect it. Read some pointers for moving a 401(k)
| - When you finally have time for long-term planning, consider IRAs, annuities, and estate planning issues, as you develop your plan.
- If you have children, be certain it is spelled out in writing who will pay what portion of child care and education costs.
- Consider having an insurance check-up to be certain you have all the health and life insurance you need.
- Be sure you understand the tax implications of all these changes, how to minimize any tax bite, and get all the deductions you deserve.
- Do you have any trusts in place? Make certain you understand which trusts you have and which you might need.
| Remember -- don't hesitate to seek professional advice as you work through these choices. And there's no time better than now to start the rest of your life. |
