Divorce has many financial consequences, which is why it’s important to be mindful when you make decisions. It’s always necessary to follow through on post-divorce actions to make sure you don’t end up costing yourself money on accident.
For example, if you have an IRA, it’s vital to change the beneficiary designation following a divorce if you ex-partner is listed and not intended to be the beneficiary any longer. Additional items to check include 401(k)s and documents for retirement plans. Insurance policies also need to be updated.
This is particularly important if you get remarried or have a new partner who you want to have receive an inheritance upon your death. For instance, if you pass away suddenly, your new spouse may believe he or she will obtain your life insurance policy payout, but your ex-husband or ex-wife might still be the beneficiary if you forgot to change the documents.
After a divorce, you probably just want to move on and forget about what you’ve been through, but these financial steps are necessary to protect you in the future. If the judge did not issue an order that your ex-spouse remains on those documents as a beneficiary, you need to take the time to change them over to protect yourself, your children and your future partner.
Your attorney can help you write down a list of important documents you may need to change and help you address those legal issues. With the right changes now, you can protect your finances in the future for yourself, your spouse or partner and your heirs.
Source: WTOP, “Be mindful of divorce’s financial consequences,” Dawn Doebler, accessed June 09, 2017