Finance and Divorce
Divorce can be unexpected, catching either spouse off guard and unprepared for the issues to come. In many relationships one spouse may handle the couples finances, taxes, and other administrative responsibilities, leaving the other spouse completely unprepared to assume those responsibilities after their relationship has ended.
Although the couple’s marital assets and debts may be equally distributed through alimony (spousal support) and child support, a newly divorced spouse may not have the experience to assume control over their own bills, taxes and insurance.
1. If you are facing divorce, it’s important to consult with an experienced divorce lawyer as soon as possible to avoid some of the more common financial problems such as the following:
2. Banking – Checking and savings accounts should be created as soon as legally allowable. Consult with your attorney before removing either spouse from a joint account to avoid legal issues later.
3. Insurance – One spouse will probably take over their own car, renters, homeowners, or health insurance. It’s important to consult with your insurance agent before proceeding with any changes in coverage.
4. Credit Cards –It may be necessary for one spouse to apply for a card in their own name. The other spouse may need to remove additional users from their account and create a new one.
If the card must be used for expenses while the divorce is pending, it may be best to remove the second user from a joint credit card. It’s important to stay protected from any credit card debt incurred by your spouse while a divorce is pending.
5. Financial Management – Find a good accountant and advisor who can counsel you on unfamiliar issues such as taxes and investments.
6. Taxes – If one spouse has been primarily responsible for filing joint taxes, find an accountant who can help navigate important tax issues. It’s better to pay a professional than to risk mistakes and potential penalties.
Aside from the challenges of alimony (spousal support), child support, and the division of assets. There are many other financial implications that must be addressed. If you’re facing divorce, please contact the experienced West Michigan attorneys at Johnsen Wikander and let us help you through your most difficult time.