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What financial steps to take after a divorce

Much of the hard work in a divorce comes before and during the proceeding. However, the time after a divorce can also determine in part your financial status.

Making a few smart moves at this stage will help you move forward without unnecessary complications and expenses.

Making changes to critical documents

Once you know your divorce is imminent, you should begin to make changes to your financial accounts. Once the courts have finalized the divorce, you should, according to a report in U.S. News, review all of your critical personal documents in the following areas:

  • Paperwork vital to your employment
  • Documents that involve your Social Security
  • Accounts that include credit cards and banking
  • Documents that identify you

At this point, do not forget insurance documents such as a long-term care insurance program or regular healthcare. Also, make sure you establish the legal obligation related to car payments and other financial entanglements. Only having a verbal understanding with an ex-spouse can backfire and leave you paying extra for items bought on credit.

Addressing estate plan documents

If you established an estate plan as a married couple, many of these documents no longer match your goals. You might need to change your will, any paperwork with power of attorney and any health care directives.

When things settle down, you might want to revisit your estate plan in a way that reflects your new independence. At this time, also make sure to update any beneficiary designations for retirement accounts and life insurance policies.

A divorce leads to many changes and calls for close attention to many legal details. Make sure after a divorce, you attend to all loose ends in your financial life.