713-333-4430A Legal Take on How to Co-Manage Finances with a Soon-to-be Ex
What makes divorce even more complicated is the added layer of difficulty in figuring out how to balance and manage finances with your soon-to-be ex, frequently coated in emotions and stress. The following guide is here to help you get a handle on co-managing finances and ease you into a smooth transition to financial independence.
Legal Landscape of Co-Financial Planning
A Texas divorce applies an equitable distribution of assets and an adherence to property division laws. The result is fair financial outcomes for both parties. Texas’s divorce laws also emphasize the principle of community property, where marital assets and debts are usually split equally. However, prenuptial agreements show how assets will be divided if a soon-to-be former couple has one in place. The legal scope of Texas divorce law underscores the importance of processing your divorce with the help of an attorney.
Financial Planning in Divorce
The most vital aspect in this stage of divorce is careful planning and a calm head to make informed decisions that set you up for a stable financial future. Consider the following planning tips we have outlined in the sections below.
Evaluate Your Present Financial Position: Take stock of your current financial standing. List the assets, liabilities, joint accounts, and debts you and your soon-to-be ex-spouse share. Reading into your financial standing provides a solid foundation for the actual planning part that lies ahead.
Create a Realistic Budget: The importance of sitting down, designing, and following a budget during and post-divorce cannot be overstated. Of course, be realistic about your financial needs and identify areas where you can cut back to guarantee monetary resilience.
Opening Individual Banking Accounts: Part of any separation will ultimately involve opening your account, and it is best not to procrastinate. Consider establishing an individual bank account to assert your financial independence. Opening a single bank account will also ignite and streamline the management of your personal expenses.
From a legal standpoint, there are several advantages to opening an account and axing the joint account, including avoiding financial entanglements, cushioning your credit, and facilitating asset division. However, to be sure it’s the appropriate time, it’s best to consult your attorney first.
Closing Up Your Joint Accounts: Although this point was mentioned in the previous section, closing your joint accounts and credit cards deserves highlighting. Leaving them open leaves room for debt to accrue, which can quickly impact your credit and financial opportunities.
Update Beneficiary Information: Revisiting and revising your beneficiary information is crucial on various accounts. Significant legal implications and financial consequences can result from neglecting this frequently overlooked task. From the legal perspective, beneficiary designations on accounts like life insurance policies, retirement plans, and investment accounts take precedence over provisions in a will. If your ex-spouse is still documented as the beneficiary, then they may have a legal claim to those assets. Even if your will specifies otherwise, they may still have a claim if listed as a beneficiary, which can translate into disputes, delays, and potential legal challenges. A seasoned family law lawyer can review all corresponding legal documents, and provide legal guidance.
Separate Emotions from Financial Decision-Making
While it’s normal for emotions to flare up during a divorce, they must be curbed overall, particularly when making financial decisions. Approach financial matters with a clear mind and focus on the practical aspects to achieve the best outcomes for both parties.
Additional Suggestions
It is a good idea to keep an eye on your credit reports and score during and after divorce to watch for any surprise activity and catch damaging events early. You may also inform creditors of the divorce and agreed plan for the distribution of assets. Some creditors may even be willing to work with you during this transition period. Lastly, aside from legal counseling, you may wish to confer with a financial planner or advisor.
Employing a Legal Ear
Each divorce has its distinct marks and attributes, making it unique; however, the above guide applies across the board. With the ups and downs divorce brings forward in waves, it’s great to have a compass, a guiding light, or in other words, a voice of knowledge and sound input: your attorney. Work with a skilled Texas divorce attorney to get advice tailored to your circumstances and your life and assistance in identifying areas of concern or urgency. Taking proactive measures can pave the course for a near effortless financial transition post-divorce, like scheduling a confidential consultation with an experienced Houston divorce lawyer .
Attorney Kevin Hunter at Boudreaux Hunter & Associates, LLC has experience with child custody, spousal support, high conflict divorce, and is fully equipped to guide you through the process. Learn more about Kevin on his profile here.
