Going through a divorce can be a major headache for everyone involved, and it's best to be as prepared as possible before your case proceeds. There are many important actions men can take to protect themselves in a divorce, but getting a lawyer and monitoring finances are two of the most crucial. You don't want to make your divorce any more painful than it needs to be, right? For men going through a divorce, we rounded up nine financial matters to consider.
Read on for some financial issues all men getting divorced should consider.
Call your broker and divide any stock, bonds, or mutual funds that are held jointly with your spouse. While this is not a taxable event, you will have to take future taxes into account if you want to be fair. Therefore, ask your broker to make sure the tax basis is equalized as well.
Open an account in your own name if you don't already have one, and close all joint credit or loan accounts. Notify the banks, charge cards, and others by a certified, return receipt letter that you are no longer responsible for the expenses of your spouse. You do not want to wake up one morning and discover that your spouse has charged $5,000 on your joint credit card on a spending spree. You may be responsible for paying part or all of that $5,000. According to an article from Psychology Today, "even after a divorce, debt acquired by either party during the marriage is often considered communal responsibility."
Once you've closed all joint credit cards, let your spouse know, so they aren't caught by surprise when the credit card no longer works.
If you cover your spouse or children on your insurance, do not drop them from the policy at least until the divorce is final. You are probably responsible for their medical bills until then, too. Even after the divorce, the employed spouse may want to keep the ex-spouse and children covered. If you are paying child support, a large unexpected medical expense for the child could be assessed against the noncustodial parent as additional child support.
The same could happen with alimony and an ex-spouse. Federal law allows most employees to cover their spouses for up to 36 months after a divorce for a small additional premium. However, the employer must be notified prior to the final divorce decree.
Two cannot live as cheaply as one, especially if they are separated and trying to maintain two households. It is time to cut costs as much as possible. Cancel anything you do not need, like extra telephone lines or cable television. If there is any personal property you do not want or need, sell it with permission of the courts.
However, do not cut off the utilities on your children and your spouse without giving them plenty of notice. Make sure you can prove this notice to the court because leaving your children and their parent home without heat or light in December seldom sits well with the judge.
Retirement funds acquired during a marriage are marital assets that can be divided by the divorce court. So chances are good that your spouse will share in anything you contribute now to your pension plan at work or your Individual Retirement Account (IRA). Fill out the paperwork to have your employer stop your contributions to your 401(k) account or another pension plan. Do not make contributions this year to your IRA. This will keep your spouse from getting part of it and chances are you will be needing the money soon.
Move any valuables, like collections, jewelry, artwork, firearms, cash, and heirlooms out of the house to a safe place. Anything with significant or sentimental value to you ought to be secured from your spouse. You are not trying to hide things, but you do not want to come home from work and find your valuables have been sold at a yard sale.
Safety Deposit Box
You can establish a safe deposit box to store your valuables away from the house. If you already have a safe deposit box and your spouse has access to it, you will want to remove your items and store them somewhere else. Make a list or take a picture or videotape of whatever is left in the box for proof later. The same goes for any storage unit you may have.