Are you contemplating divorce? Do you know that if you are not careful, divorce can cause acute financial crisis apart from the emotional one? You can protect your wealth with a few simple steps.
Marshal your credit details. Tot up your loans and try to pay them off. Do the same with your spouse’s credit. Do you have joint loans? Get rid of them. Close all your joint accounts; pay off and cancel all joint credit cards. Creditors can follow either of you even after divorce. Remember that all assets that accrued during the marriage will be split; assets you had before marriage and those you accumulated after filing for divorce are yours alone.
Disclose all investments and get them valued. This includes equity, bonds, stock options, and other stuff that you bought together, including things of sentimental value. There are people who do a professional valuation of all these.
Read and familiarize yourself with divorce and property laws. Alimony is tax deductible; but if you get the house you have to pay tax. Alimony, disability, life insurance, and child support are important issues to be resolved and should be spelt out clearly.
Do you have a pre-nuptial agreement? If you do, the courts may uphold the agreement as binding on the division of wealth. Remember to review the nominee of your insurance and other investments.
Is your spouse planning to file for bankruptcy? Keep this in mind as any debts undischarged by your spouse may be transferred to you even after divorce. Get professional help. There are people called Certified Divorce Financial Planners who can see you through what can be an incredibly stressful period, emotionally and financially. There are agencies that help you with the valuation of even articles that are extremely difficult to assess.
Did you have a particularly bad financial experience in the aftermath of a divorce, or know someone who did? If you managed to come out of a divorce unscathed, do share some advice for other readers.
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