Portrait of John K Grubb

Texas Divorce and Prenuptial Agreement

4550 Post Oak Place, Suite 201 • Houston, Texas 77027-3139

Phone: 713-877-8800 • Fax: 713-877-1229

5 Tips for Financial Recovery After Divorce

Divorce can impact your financial health. Sometimes you face a dramatic lifestyle change. We’ve been lucky in Houston that the housing market has held steady as compared to the rest of the nation. But there’s no doubt about it, everything from the price at the pump to a gallon of milk at the grocery store has gone up.

With the interest rates decreasing and facing the ever-changing market, there could be less for you and your spouse to divide. You most likely already realized this fact. There are some things that you can do right now that will help you down the road to your post-divorce financial recovery.

#1 Open Your Own Accounts

The first thing that you want to do is make sure that all joint accounts with your ex-spouse are closed. You will want to start building credit in your own name, so open new accounts as soon as possible. If you have kept your home in your divorce settlement, make sure the title to the house is changed to reflect this. Also notify the mortgage company.

You also must change the name on the utility bills, vehicle registrations, tags, and title. Make sure that you update your will and insurance to remove your ex-spouse as beneficiary. Close your joint safety deposit box and open a new one in your name only. Transfer all your important papers, including your certified divorce decree, in your newly opened safety deposit box.

#2 Tell Everyone Your New Name

Notifying others of your new name is not just telling friends, family, and co-workers. When you married, you probably changed your name on many legal documents. If you changed your name on documents like your drivers’ license, social security card, and passport, you need to get new ones immediately.

Also notify credit card companies, your bank, your investment account brokers, financial advisor/accountant, and your lawyer. You don’t want your former name appearing on any personal correspondence or documents.

#3 Check All Your Credit Reports

Equifax, TransUnion, and Experian are the 3 major credit bureaus. Inform them of your name change and request a copy of your credit report from each of them. There is no charge for the report because Federal law states that you are allowed one free report every year. Review your report thoroughly, making sure that your name has been changed and that all your information is correct. Notify the credit union in writing of any incorrect information.

#4 Review Insurance & Retirement Plans

Make sure that your health, life, auto, and homeowners/renters insurance are up to date and in your name. Change the beneficiaries on any policies where your ex-spouse is named.

The next thing you want to do is thoroughly review your retirement plans. Make sure that the QDRO has been submitted and implemented by the plan administrator. If you are receiving funds, make sure that you have an account in place to receive any transfer of funds.

#5 Create Your Household After Divorce Budget

Your divorce included giving a lot of financial information about your monthly expenses, so you’ve done much of the work. Now use the information you gave your lawyer and the Houston Family Court to prepare a new household budget. Make sure that you have included all your monthly expenses – rent/mortgage, utilities, home upkeep, insurance, amounts you want to save, and anything else you think of that you will pay each month.

Don’t forget to accurately estimate child care costs – schooling, health insurance and life insurance if you will be paying these. Add back in any child and/or spousal support you will receive. Don’t forget that spousal support in Texas is for a limited time only.

Divorce is emotionally challenging. Many times the things you normally do fall by the wayside during the chaos. These are common sense tips, but if you remember to implement them, you will be well on your way to financial recovery after your divorce.

No Comment

Comments are closed.