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FINALLY! After an emotional roller coaster, you get that 8 ½ by 11 manila envelope with your divorce decree signed by the judge. You are officially a single person once again. You may celebrate, or you may mourn on that day, but stay focused, you’re not quite done yet. There are some critical items that you want to take care of right away.
Review Your Decree - First, make sure you fully understand what’s in that envelope and what’s been awarded to you. There’s a good chance that you now need to have a QDRO prepared to split a retirement plan. (Assuming you sat in on negotiations you have already heard this term) Don’t delay! Get that going now to ensure a timely split of the account. Now is a great time to sit down with a CDFA, Certified Divorce Financial Analyst/ financial advisor to map out your new financial plan, open any new accounts necessary and consolidate any old ones. You want a financial advisor who has the CDFA designation because they are already familiar with divorce laws and terms as well as the financial ramifications of your settlement.
Review all accounts - Be sure to remove your ex-spouse’s name from any existing accounts including utilities, banks, credit cards, insurance policies, etc. If you don’t already have one, get a credit card in your name alone. Now is the time to establish your own financial identity.
Get Organized – If you’ve never had one, create a filing system for all of your important financial documents as well as any statements that need to be retained for taxes. If you’re tech savvy, this might be 100% electronic but it needs to exist.
Review Estate Docs – Be sure to update all your beneficiaries on accounts and insurance policies immediately. I could tell you nightmare stories of ex spouse’s inheriting huge 401(k) plans because someone forgot to update the beneficiaries.
Write a New Will – Everything has changed. Be sure your new wishes are clear so there is no confusion. If you had any trusts in place, you’ll need to have them terminated and create new ones.
I’ve had clients call me when they received their final decree in the mail. Some told me it felt like a new beginning. They shared how they were going to miss the old life, just a little, but also felt the anticipation of the new one. When I run into old clients after their divorce, and they tell me about their new lease on life, I’m convinced that their divorce was one of the biggest blessings of their lives. The change allowed them to become a much healthier, well-rounded, happier person. The business side of things isn’t tons of fun, but with each step you’ll feel your new independence and identity sinking in and it will all help you to heal.
Today is the first day of the rest of your life. Make it count!
This article was contributed by Donald Morris, President of winwindivorce.org and a financial advisor.