It is important to prepare for financial independence well before you actually file for divorce or separation to avoid costly pitfalls down the road. Having served hundreds of families since our Family Divorce Consumer Advocacy was formed in 2010, we have watched many suffer the costly pitfalls of not taking a few simple steps BEFORE separating or filing for divorce.
If you have been financially dependent on your spouse for a large portion of your marriage it is possible that you may not have an independent credit history. Those that don’t have an established credit history may be required to shell out hundreds of dollars in deposits when establishing things such as new utility accounts and renting an apartment for temporary housing post divorce. If your name wasn’t on your family home mortgage it actually may not be possible to transfer it to you should you desire to assume the payments and stay in the home. There are several things you can do to overcome this.
4-Establish your own banking savings and checking accounts
5-Try to resolve as much debt on joint account credit cards as you can
Also during temporary separation but BEFORE your divorce settlement is finalized make sure to add your name to ALL family investment accounts that will be separated. If your name is only added to the account AFTER the settlement and you decide you need to sell some of those investments within 12 months after your name was added you could incur an unexpected hefty short term capital gains tax (28%-35%). More financial tips in the Transitions Divorce Prep Workbook
Do you have a personal story that you can share regarding these issues? I would love to hear from you.
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Disclaimer: This is my personal blog. The opinions I express here do not necessarily represent those of my organization, Transitions Resource, LLC. The information I provide is on an as-is basis. I make no representations as to accuracy, completeness, suitability, or validity of any information on this blog and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its use.