Planning for Divorce: A Comprehensive Checklist

Gather and Organize Financial Documents

Divorce proceedings can lead to the disappearance of assets. To plan for future expenses, it’s crucial to gather and organize your financial documents, including:

Essential Financial Documents

• Bank and savings account statements
• Credit card bills and agreements
• Retirement and pension plan statements
• Investment account statements
• Life insurance and annuity contracts
• Loan documents and applications
• Home title or lease
• Wills and trusts
• Marriage and birth certificates
• Federal and state tax returns for the past five years
• Business records and financial statements
• Social Security records
• Military discharge papers
• Pre- or post-nuptial agreements
• Miscellaneous income and assets

 

Retirement and Pension Plans

Obtain detailed descriptions of your retirement and pension plans, including:

• Year-end bonuses
• Accrued vacation and sick time
• Health insurance
• Life insurance
• Disability insurance
• Expense accounts
• Stock options
• Unusual benefits like Phantom Stock, Stock Appreciation Rights, and Restricted Stock

Secure Your Financial Future: Practical Steps

Safeguard Important Documents

Make copies of crucial documents and store them securely.

Settle Joint Accounts

Pay bills and clear joint credit card balances before separation to avoid future financial entanglement.

Access Safe Deposit Boxes

Assess and secure the contents of safe deposit boxes, including both keys.

Obtain Credit Report

Obtain a copy of your credit report to gain insight into your financial status.

Establish Separate Accounts

Open a post office box or private mailbox and create a separate bank account and credit card in your name.

Attend to Repairs and Maintenance

Use joint funds for necessary car and home repairs, medical checkups, dental work, and essential shopping.

Choose Your Financial Professional

Types of Financial Advisors

• Accountant (CPA): Offers advice on financial statements and tax filings. Useful for cases involving family-owned businesses.
• Certified Financial Planner (CFP): Assists with budgeting, tax planning, and retirement, estate, and investment planning.
• Certified Divorce Financial Analyst (CDFA): Specialized in divorce-related financial issues, including property division and tax implications.

Finding the Right Advisor

• Seek referrals from friends, relatives, and trusted professionals.
• Interview candidates and assess their qualifications.
• Ask questions about typical clients, services, disciplinary history, and fees.

Moving Forward: Steps to Take

Protect Yourself Financially

• Get a checking account and credit card in your own name.
• Notify banks of jointly held accounts in writing to prevent unauthorized withdrawals.
• Understand state laws and your finances.
• Prioritize and negotiate financial settlements calmly.

Transition After Divorce

• Change your name as per the divorce decree.
• Update social security, driver’s license, and identification.
• Keep copies of judgments, agreements, and divorce certificates.
• Notify child support enforcement and relevant entities.
• Ensure compliance with court orders, such as Qualified Domestic Relations Orders (QDROs).
• Close joint accounts and address outstanding checks.
• Update automated withdrawals and charges.
• Distribute property and transfer titles.
• Review and adjust insurance policies and wills.
• Maintain records of visitation and support payments.
• Seek legal advice if your ex-spouse files for bankruptcy.

By following this comprehensive checklist, you can navigate divorce with greater financial security and peace of mind. Remember, divorce is a significant life change that requires careful planning and professional guidance to ensure your financial well-being.