When most people commit to marriage, they do not anticipate it will end in a divorce. Being in a committed partnership often means couples share their personal belongs out of convenience and love.
But things don’t always work as intended. According to statistics, approximately half of all marriages end in a divorce. If it happens to you, you must know what to do or not do to ensure you do not leave your marriage empty-handed after years of saving and investing as a couple.
Get a Lawyer and Know Your Worth
If you are on good terms with your soon-to-be ex-partner, you can go through a divorce without the need to hire a lawyer. But amicable divorces are rare, so getting a lawyer may not be a choice but a must. If you consider yourself a high-net-worth individual, hiring an attorney even when your divorce is amicable is important to ensure that everything you do is above board.
Once you get a lawyer, the next step would be to know how much you are worth. Even if you do not consider yourself rich, you may be surprised at how much you own if you do a personal audit.
Knowing your worth is important because it helps you understand what you are fighting for. This means looking at your wealth, including your combined balances in your 401(k), savings plans, 529 accounts, credit card bills, and every asset registered in your names.
Avoid Hiding Money
Suspicions can run high when a couple is going through a divorce, and you may feel like you want to hide some money, but it is never a good idea. Hiding money in anticipation of a divorce can further escalate the contention and get you on the wrong side of the judge.
However, that doesn’t mean you cannot protect your money if you are worried you could lose it. But when you take such steps, be in the open.
For example, if your money is in a joint account, you may want to get half of what is there but communicate your intentions to your partner. Alternatively, you can ask your lawyer for help freezing the account until your divorce is finalized.
Update Your Life Insurance Beneficiaries and Consider Taxes
If you have a life insurance cover, it is time you start thinking about updating your beneficiary if your soon-to-be-ex is the beneficiary. Changing a beneficiary in your insurance policy is straightforward.
You will only need to visit your insurer’s office and tell them you intend to change the beneficiary. “You may be surprised to hear that people forget to change their beneficiaries, resulting in ex-spouses receiving benefits after the death of their ex-partners,” says family attorney Tammy Begun.
Taxes
The taxman still expects you to take care of your tax obligations irrespective of what you could be going through. Sometimes, couples forget to consider tax implications when splitting wealth. For example, if one partner keeps the house while the other goes with retirement assets, tax implications will differ, meaning that one party will get much less.
Finally, you will need to get your paperwork right to reduce the risk of missing out on what you deserve. One of the best ways to ensure that nothing is missed during your divorce process is to work with a divorce lawyer.
