Preparing Financially for a Divorce
By Katie Bruno, MIMFA, CERTIFIED FINANCIAL PLANNER™ Professional
The Morey and Quinn Wealth Partners in Omaha, NE can offer guidance and help you protect your interests throughout the process of divorce.
The end of a marriage can be a challenging time, both emotionally and financially.
One of the biggest disadvantages in divorce is not fully understanding your family’s financial matters. You may find yourself taking on a new role in the household, such as managing investments or the monthly budget. Navigating this process will require careful planning and seeking answers for many questions. Where will you live? How will you split your assets? Will you have enough income after divorce?
If you are considering divorce, or in the beginning phases of the process, here are eight tips that can help you prepare and plan ahead.
1. Gather important documents.
Start with bank statements, tax returns, loan statements, insurance policies, property deeds, and motor vehicle titles. Organize the documents so that all of your information is easily accessible throughout the process.
2. Understand the titling on your accounts.
It is important to review the titling on all your financial accounts to understand what is joint, and what is separate property. Reviewing your accounts will also help you know the estimated value of your assets for transferring or selling.
3. Review benefits.
You have the right to receive information about your spouse’s benefits, including health insurance and retirement assets. If you are currently on your spouse’s health insurance, reach out to their employer to see if you will still be covered. If not, reach out to your employer to review your benefits, or begin looking at individual plans.
4. Know your retirement options.
Retirement accounts and savings can be considered marital property. You may have a right to a portion of your spouse’s retirement. Divorce provides a one-time opportunity to withdraw savings from a spouse’s 401(k) or 403(b) without having to pay the 10% early-withdrawal penalty.
5. Consider all housing options.
If you are a homeowner, you may be thinking you would like to keep the house, especially if you have children. Your options include keeping the home, selling it, or deciding to sell in the future. Determine if you can afford to stay in your home, given maintenance costs, outstanding mortgage, taxes and insurance. If you leave the property to your spouse, we recommend talking with them about refinancing, so as to take your name off of any debt associated with the property.
6. Educate yourself on social security options.
If you have been married for more than 10 years, you may be eligible to receive benefits equal to half of your spouse’s social security. Consult your financial advisor or visit ssa.gov for more information.
7. Avoid making big changes without consulting those you trust.
Don’t do anything without considering the long-term impact it could have.This includes making large purchases, and gifting or changing your legal and estate planning documents. Your Morey & Quinn financial planner can advise you on big decisions that may affect you or those you love, financially.
8. Keep copies of all correspondence.
Be careful about what you post on social media or in writing. According to the American Academy of Matrimonial Lawyers, 80% of divorce cases involve evidence on social media. Be thoughtful of anything that could be used against you.
When planning and preparing for a divorce, it can be difficult to imagine what your life will look like beyond divorce.
Women, especially, may face unique challenges if they are not the primary financial manager of the household and find themselves in a new role. Our female financial planners understand the challenges that women investors have and can help you navigate the process of being newly single.
Regardless of your situation, the Team of Financial Planners at Morey & Quinn Wealth Partners in Omaha, Nebraska are here to help both men and women investors as they prepare for changes in marital and financial status. We can help guide you to a Well Planned Life.
Morey & Quinn Wealth Partners
Raymond James® LIFE WELL PLANNED.
11225 Davenport St, Suite 109
Omaha, NE 68154
The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete.
Any opinions are those of Katie Bruno, and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. Investing involves risk and you may incur a profit or loss regardless of strategy selected.
Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional.