SAN ANTONIO — A divorce can be cheaper or expensive depending on several factors. If you hire an attorney, if your divorce is contested, whether children are involved or whether a trial is necessary all play a role. As you move forward with the divorce process, here is a Money Smart checklist to take into account.
1. Cash flow
“The obvious one is will your cash flow needs change? In other words, was one spouse working and the other wasn’t? If you’re the one that’s not working, where are you going to get your cash flow from based on the settlement? Do you need to get another job? You need to assess your new budget,” said Karl Eggerss, senior wealth advisor and partner of Covenant.
2. Review your debt.
Texas is considered a community property state. Debt incurred during a marriage is considered to be a joint responsibility.
“You need to keep an eye on your credit report. You can obviously get those checked nowadays very, very easily. A few times per year,” recommended Eggerss.
3. Change your beneficiary on accounts
“This is one that I see a lot of people making a mistake. They don’t go and check the retirement accounts to change their beneficiaries. Usually, a spouse will have their other spouse as their beneficiary on their IRA, on their 401k at work. Make sure that you change that beneficiary, assuming that you don’t want your ex-spouse to get the proceeds if something were to happen to you," explained Eggerss.
4. Social Security
“If you were married for more than 10 years, you might be eligible to claim your ex-spouse’s social security when it is time. That can add thousands of dollars to your overall income in your lifetime,” said Eggers.
5. Housing
“Where are you going to live? Are you going to get the house in a settlement? Is there debt on the house? Or you going to rent or buy a new house? That all needs to take place in a financial plan. Not only figure out your cash flow needs, but especially your housing needs.” he suggested.
If you have a complex financial situation or believe your spouse is hiding assets or funds, a divorce attorney can assist you with a forensic accountant.