Protecting Your Own Assets During a Divorce
Some marriages simply cannot be saved. For one reason or another, two people can’t be together as a cohesive unit. When it comes time to file for a divorce, how do you ensure that your own assets are protected from the other party? Depending on the circumstances surrounding the divorce, protecting those assets may be quite difficult. However, there are a few things you can do to make sure you’re not left on the doorstep of being destitute.
1. Close the Joint Accounts:
You want to remove your name from as much as you can that is linked with the other individual. Some things can’t be dissolved so easily, such as a house mortgage, but the bank account can be closed. This also includes any credit cards you have with your spouse. Don’t accumulate additional debt from the expenses of the other party. Of course you want to make sure that any debtors that automatically withdraw from the account are aware you are changing bank accounts for your own bills. This will protect you from the other party exhausting the funds without paying those collectors.
During the marriage, you may have been covered by your spouse’s insurance. Once you commit to a divorce, you want to make sure that you have your own coverage in the event of an emergency. Assume that your soon-to-be ex-spouse removed you from insurance coverage and protect yourself. In the worst case scenario, your new household income may be low enough to qualify you and/or your children for Medicaid and you should investigate that opportunity as soon as possible.
3. Consider Liquidation:
Items accumulate throughout the marriage are often the focus of disagreement and heated debate. Liquefying the assets puts a monetary value on the lot of items and is easier to distribute than comparing the value of your favorite chair versus the hot tub – for example. Items can be replaced in your new life and liquefying the assets will put cash into the hands of both parties in order to start anew. With the exception of family heirlooms, virtually anything can be replaced.
4. Your Own Bank Account:
After closing the joint account as mentioned above, you need to establish your own. Many couples have a private secondary account, which comes in handy when you need to buy birthday or Christmas presents. If you have your own, then you are already on the path to individuality. Otherwise, you’ll need your own account as soon as possible.
5. Credit Reports:
Obtain your credit report immediately. This gives you a comparison of what is reflected during your life together compared to future additions. This will also provide you with a method to cover yourself should your significant other decide to attempt fraudulent activities regarding a joint account or your own personal information. It is better to protect yourself than to become a victim later on.
Divorce can be a messy business as it is without you and your spouse arguing over money or goods. The best thing you can do is remain calm during the procedure and invest in a mediator to help separate your life together. Sometimes the view of an unbiased third party can be quite beneficial to yourself and your spouse in order to keep the peace.
Written By: Linda Bailey
About the Author:
This post is contributed by Linda Bailey from housekeeping.org. She is a Texas-based writer who loves to write on the topics of housekeeping, green living, home décor, and more.