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May 2nd, 2008
Divorce is a difficult process for anyone, both emotionally and financially. It can be especially complicated when one of the partners is financially dependent on the other. The non-working partner is all but dependent on the other for not only their current income, but future income and retirement. Should you ever be involved in a divorce, it’s vital that you approach the situation with an eye toward the future. Here are some tips for protecting your assets and future retirement in a divorce.
How to Protect Your Assets
- No matter how tempted you may, don’t dip into your retirement fund to help pay for the divorce. Hiring a lawyer and going through the divorce process is never cheap, but you’re much better off borrowing the money through family or a loan because once you’ve started using that retirement money, you’ll probably never get it back.
- While it’s important to have experienced legal help during the divorce proceedings, it’s equally important to have a quality financial advisor as well. Since many of your assets won’t have easily discernable value yet, you’ll want a smart financial advisor to help asses the long term impact of your assets.
- Understand what debts you and your spouse are mutually responsible for. Don’t assume that you’re fully responsible for paying off certain credit card debts just because they are in your name. Most debts can be negotiated with your spouse so that you both have a responsibility to pay them off.
- Close any joint bank or credit card accounts as early as possible. If you don’t have any individual credit cards or bank accounts, you’ll want to open one as soon as possible as you’re no longer financially dependent upon your spouse.
- Make sure any financial information used in your retirement case is accurate. You’ll want to keep copies of all of your financial records with you, such as records of investments, retirement funds, tax information, and bank statements.
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