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Top Tips for Women and Divorce

I wish I had the opportunity to talk to every woman who is considering a divorce. If I had that opportunity, I would share the importance of being patient and planning out your financial life before notifying your spouse of your plans. Knowing where you stand financially can take some of the stress off in some cases, while in other cases may stop you from moving ahead until you have better financial footing. However, realistically, patience is not always an option depending upon your situation. So, even if you’re already in the throes of divorce or have already received the final closure of your divorce, read on for tips you can use.


  • Take time to find a good attorney specializing in divorce. The importance of finding an attorney you feel has a good understanding of your needs as well as a proven track record can make the entire process easier. You must have a sense that the attorney understands your wishes and that you understand the process. If the two of you can’t communicate well, you should find an attorney more willing to walk you through the process and understand you.  For some, hiring an attorney can become a part of what overwhelms due to the potential costs and their lack of rescources to fund this critical part of getting a divorce.  If you feel you can’t afford legal counsel, there are some situations where a court may require the high-earning spouse to pay the legal fees and expenses of the lower-income spouse. Not in this situation? Don’t worry, do some research to find a pro bono divorce lawyer. A pro bono divorce lawyer is essentially free. These are attorneys that will voluntarily take on your case at no charge. (Because divorce is a civil legal matter, the court will not appoint a lawyer to represent you, as is done in criminal cases.)


  • You will want to review all of your joint accounts including checking, savings, credit cards, and investment accounts. You need to do this for a couple of reasons. You need to be very aware of your overall financial situation going into the divorce. Also, if you are concerned that your spouse may raid the accounts or rack up credit card debt once your plans for divorce are known, there are several steps you can take to protect yourself and your assets in advance. However, to know what steps to take, consult with your divorce attorney first.


  • Get a P.O. Box. Once you start looking into things like credit in your name only, hiring an attorney, cpa, financial advisor and beginning the process toward divorce, consider getting a P.O. Box for correspondence. This is particularly important if you have any concerns of retribution from your soon to be ex.


  • Create a before and after budget. There are many free budget templates like mint.com. Some like mint.com can link directly to your bank account, but there are many without the link. Keep in mind if you link direct to your bank account, you’ll want it to be an account in your name only. Create a budget and you’ll be better prepared for what lies ahead. The budget gives you the knowledge you need about your financial situation day to day and it’s imperative! You’ll know what expenses go away with your ex-husband. You’ll also be more clear about what you need to sustain your life and that of your family when you’re on your own.  This is an important way to assist your attorney in alimony and child support requests. Anything you can do to provide more information on your financial situation can typically help you and your family, especially when you have low or no salary.


  • Start your own credit history. If you don’t have any credit in your name, establish it now. You can do so by obtaining a credit card in your name only. Choose to use it sparingly and make sure you can pay off the balance every month so that you don’t incur interest charges. This type of credit and pay-off activity is one way to establish credit in your name.


  • Review credit reports to see if there are any credit card accounts or loans that you weren’t aware of and to see clearly what you owe and what limits are available. You can get a free credit report at annualcreditreport.com. And you’ll also want to look at your FICO score for free at www.myfico.com/fico-credit-score-estimator/estimator/.  Knowledge is key to understanding your personal financial situation and understanding how you look to lenders for your future borrowing needs.


  • Find a good CPA/tax advisor. There are a few areas that may be taxed that you aren’t aware of, for example, alimony. A tax advisor can assist you to better understand what your net income from alimony will be after tax. This is especially important when planning your budget. A tax advisor/CPA can also help with the division of retirement plans. Qualified Domestic Relations Orders (QDROs) are legal orders from divorce courts used for the purpose of splitting specific types of ordinary retirement plans, including IRAs, private pension plans, and 401(k) plans, with an alternate payee, most often a former spouse. A lawyer who practices family law usually takes the lead in drafting the QDRO, but enlists one or more CPAs to apply their financial expertise to the QDRO provisions to ensure an equitable division of retirement assets between the divorcing spouses without triggering negative tax consequences. This according to the Journal of Accountancy. A QDRO is not automatically assumed in a divorce, even if your ex-spouse has a substantial retirement account — You have to ask the court for one as part of your property settlement.

Important Note: The views expressed in this post are as of the date of the posting and are subject to change based on market and other conditions. This post contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected.

Please note that nothing in this post should be construed as an offer to sell or the solicitation of an offer to purchase an interest in any security or separate account. Nothing is intended to be, and should not be taken to be, investment, accounting, tax or legal advice. If you would like investment, accounting, tax or legal advice, you should consult with your own financial advisors, accountants or attorneys regarding your individual circumstances and needs. No advice may be rendered by Lenity Financial, Inc. unless a client service agreement is in place.