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Recovering financially from a divorce

| Sep 9, 2020 | Divorce

Those in California who go through a marital breakup often feel as if their lives have been thrown into chaos. Divorce is not only emotionally and psychologically taxing, but it can also wreak havoc on a person’s finances. Here’s how to get through a divorce with as little financial damage as possible.

When the marriage ends, one of the first things an individual needs to do is examine his or her bank accounts, retirement accounts and insurance policies. It may be necessary to change the beneficiaries on these accounts at the appropriate time. If beneficiaries aren’t changed after the divorce and an unfortunate event happens, the proceeds could go to the former spouse. While these accounts are being examined, it is also a good idea to cancel any joint accounts and make sure the other party is not an authorized user on credit cards or bank accounts. Also, make sure to remove the ex-spouse from all legal documents.

A divorce is a good time to think about estate plans. If children are present, it may be necessary to alter wills, trusts and other estate planning documents. It’s not uncommon in marriages for one spouse to be in charge of investments and retirement accounts. If the ex-spouse did the investing, now is the time to examine all investments and determine if investments are prudent and still make good sense. It can be very helpful to work with an independent investment advisor to help create new asset allocations that are more appropriate.

During this time of uncertainty, it helps to remember to enjoy life. Once things begin to settle down a bit, splurging on a trip or a new hobby can add enjoyment to life and facilitate emotional recovery. Divorce is one of life’s most challenging experiences. Those in California who have questions or need legal guidance could greatly benefit by seeking the services of an experienced and knowledgeable family law attorney.