Embarking on a divorce can be one of life’s most challenging transitions, especially when it comes to disentangling finances. At Global Advisers, we advocate for comprehensive preparation to navigate this process smoothly. This pre-divorce checklist is designed to help you organize your financial life and secure your financial future at each stage of your divorce.

Before Divorce: Preparation and Organization

• Gather Financial Documents: Compile all financial records, including bank statements, tax returns, loan documents, credit card statements, investment accounts, and insurance policies.
• Inventory Assets and Liabilities: Make a detailed list of all marital and individual assets and liabilities. Include real estate, vehicles, valuable personal property, retirement accounts, and all forms of debt.
• Assess Credit Reports: Obtain and review credit reports for both you and your spouse to understand all shared and individual credit accounts and ensure accuracy.
• Open Individual Bank Accounts: Establish bank accounts in your name to start segregating your finances and establish individual financial independence.
• Set a Budget: Create a comprehensive budget that accounts for your current income and expenses. Anticipate changes that will occur after separation.
• Consult Financial and Legal Professionals: Seek advice from financial advisors and divorce attorneys to understand your financial situation, rights, and options.

During Divorce: Maintaining Vigilance and Compliance

• Monitor Joint Accounts: Keep an eye on all joint accounts, ensuring that funds are used appropriately and not depleted or mismanaged.
• Document Expenses: Maintain detailed records of all expenses related to the divorce, including legal fees, living expenses, and any child-related costs.
• Update Estate Plans: Modify wills, powers of attorney, and healthcare directives to reflect your new circumstances and ensure that they do not benefit your soon-to-be ex-spouse unless desired.
• Negotiate Fairly: Work towards a fair and equitable division of assets and liabilities. Consider future financial implications of any settlements.

After Divorce: Establishing a New Financial Foundation

• Implement the Divorce Decree: Follow through with all financial aspects of the divorce decree, including transferring assets and refinancing debts as required.
• Close Joint Accounts: Ensure all joint accounts are closed or transferred to the appropriate party to prevent future financial entanglements.
• Rebuild Credit: If necessary, take steps to rebuild your credit by responsibly using credit cards, paying bills on time, and monitoring your credit score.
• Update Beneficiaries: Change beneficiaries on all insurance policies, retirement accounts, and investment accounts to reflect your new preferences.
• Revise Financial Plans: Work with a financial advisor to update your financial plan, taking into account changes in income, expenses, and financial goals, especially focusing on retirement planning.

Conclusion

Organizing your financial life before, during, and after a divorce is essential for securing your financial future and ensuring a smooth transition into your new life. This pre-divorce financial checklist from Global Advisers is designed to guide you through this complex process, ensuring that you remain informed, prepared, and proactive in managing your finances. With careful planning and strategic actions, you can navigate the financial aspects of divorce effectively, laying a strong foundation for your future financial well-being.