Preparing for Divorce
with the expectation of failure. Married couples never contemplate that
the person they once loved could later seem to be a stranger and perhaps even an
enemy. Yet, statistics paint an ugly picture. Approximately five out of 10
marriages today end in divorce. In divorce proceedings, women lose
financially, their standard of living may drop as much as thirty percent in the
first year following a divorce. Men, may not suffer as great financially,
however, they tend to lose precious time with their children.
One of the greatest contributors to divorce is the issue of "control" - either
financial or personal. Who controls the bank account? Who sets the social
agenda? When one partner to a marriage "controls", the other partner loses
their sense of self. A divorce becomes imminent as they controlled partner
tries to regain their self-esteem.
In a divorce situation, even the most
cooperative of couples may be transformed into warring parties. It
that does occur and you are not prepared, you can be sure that you may lose out
on contested divorce issues.
Your goal must be to be prepared and be ready to
present strong arguments as part of the divorce. This always requires
pro-active planning. Below are several simple and logical ways to
protect yourself financially if you believe your marriage is in jeopardy:
ONE: Keep Non-Marital Assets
Non-marital assets are not part of the
assets divided in a divorce.
Instead, they are
considered the asset of either the husband or the wife and generally
awarded to that person in a divorce proceeding. Categories of non-marital assets
property you inherit;
from personal injury awards (eg. Worker's compensation or accident
prior to marriage; and
one party rather than the family.
assets are commingled with assets purchased or improved during the marriage, it
may not be possible to claim the asset as yours in the event of divorce.
However, some "tracing" of non-marital assets may be possible. For
example, if a non-marital asset is sold during the marriage and the proceeds
from the sale are used to purchase another asset, it may be possible to "trace"
a non-marital interest in the new asset. For example, if a car owned before a
marriage is sold during the marriage and the proceeds used to purchase a new
vehicle, a party may be able to claim a non-marital interest in the new vehicle.
To do so, it is very important to retain all documents demonstrating the sale of
the asset and the use of the proceeds realized from
TWO: Establish Your Own
Make sure your name is
listed on all household accounts and investments. Establish at least one credit
card in your own name. This will help to create an individual credit history.
When you are on your own, you will have a better chance qualifying for loans,
mortgages and credit cards. These are all important considerations after a
THREE: Review Your Financial
Maintain complete and separate records of your financial holdings such as bank
accounts, IRA's, 401K, land purchases, and stocks.
This includes assets in your
spouse's name as well. You may wish to maintain copies of these records at your
place of employment or in a safety deposit box in your name. Records have
a way of disappearing
after a divorce has been started.
Time Your Divorce
The timing of your divorce may carry
with it a significant
For example, in a single income family, the non-working spouse may not have
earned enough money to qualify for Social Security at the age of retirement.
However, if spouses are married at least 10 years and don't remarry, the
non-earning spouse may qualify for Social Security benefits based on the
ex-spouse's earnings when
both reach the age of 62.
FIVE: Close Joint
If a divorce is imminent, you should immediately contact joint-credit-card
companies in writing to freeze or cancel your joint accounts. You do not want to
be responsible for your spouses' new credit card charges, particularly when
those charges may include attorney's fees. This protects your credit. It is
important to remember that, although a creditor may freeze a joint account, the
outstanding balance must be paid off before the account can be closed.
You may also wish to close your joint bank accounts. If any proceeds are
removed, keep a carefully accounting where the money is placed or how the
proceeds are spent. You will undoubtedly be asked for that accounting as
part of the divorce process. You can
save yourself time and
money by keeping accurate records.
SIX: Video Tape Assets
You should photograph of videotape the contents of your home including any
garages, sheds or out buildings, to record the assets and fixtures contained in
each. In any divorce, it is possible that one party may be required to relocate
from the family residence. Once you relocate, it may be difficult to
recall all of the assets and furnishings that are contained in the house.
If you forget them, there is a good chance that they won't be factored into the
values that each party
receives in the property settlement.
SEVEN: Do Not
Leave the Marital Residence.
In a custody case, leaving the
marital residence may impair your ability to successfully seek custody of the
children or an award of the real estate after the divorce. By relocating,
you create a sort of status quo that courts are often reluctant to disturb.
Joint Credit Cards & Separate Debt.
If a divorce is
imminent, you should immediately contact joint-credit-card companies in writing
to freeze or cancel your joint accounts. You do not want to be responsible
for your spouses' new credit card charges, particularly when those charges may
include attorney's fees. This protects your credit. It is important to
remember that, although a creditor may freeze a joint account, the outstanding
balance must be paid off before the account can be closed.
Collect Information Related to Children.
case that involves children, custody disputes are a distinct possibility.
As a result, documents relating to your children may be critical to support your
contention regarding medical issues, care during the marriage, or who was the
parent providing their primary care. Some items you may wish to obtain or
Family photographs including those depicting family vacations or the
children's extracurricular activities;
Social Security, Student Body, and State ID cards;
Medical records and prescription information including the names and
addresses of any treating physicians or counselors for the children or the
Report cards and school records.
TEN: Hire an
Experienced Divorce Lawyer
It may be very important to hire a good lawyer early in your divorce planning
process. An experienced attorney can help you avoid mistakes that could
later cost you in your divorce proceeding. By choosing an attorney early
in the process, there is less of a chance that you will be caught off guard and
wind up playing catch up on the issues.
There are many lawyers
to choose from so it is important that you ask important questions in order to
choose one that is knowledgeable and right for you. Ask about their experience
in family practice and specifically divorce. Ask the attorney to explain
the legal issues as well as the legal process in your particular county