Considering Divorce or Separation? Take a Few Simple Steps Now to Avoid Problems Later.
None of us enter a marriage thinking it will end in divorce. We purchase a home and car with our spouse, create joint checking accounts, consolidate insurance policies, open new, joint credit card accounts, and may even draw up a will to ensure each spouse is taken care of or to determine who will become the guardian of our children should the need arise. A marriage not only joins two people, but also their futures and finances.
When a marriage breaks down and separation or divorce seems imminent, it’s wise to act proactively and take a few simple steps to reduce the chance of major problems down the road.
Obtain Legal Representation
No matter what your family and friends may advise, you need a lawyer. You may think one lawyer can work out the legal details for both you and your spouse—which could be possible—but, to avoid a conflict of interest, that lawyer can only legally represent one of you.
Each party in the separation or divorce needs legal representation to ensure fairness. You may think your divorce proceedings will be amicable, but situations—and people—can change quickly. You’ll want a representative to look out for your best interests and give you the appropriate advice you’ll need throughout the process.
Dissolve Joint Accounts
If possible, call each of the credit card companies you do business with and close your accounts. Ask if they will set up a new account in your name only. While debts incurred by your spouse after separation may not be your responsibility in the eyes of the court, the credit card issuer doesn’t care about your divorce; if your name is on the card, you’re generally liable to the issuer whether or not you approved charges.
If there’s money in another joint account, such as checking, savings, or money market, consider withdrawing some or all funds and deposit the money in an account in your name alone. It’s not illegal to do so. But remember: Withdrawing these funds does not make them yours and you will have to account for every dollar. If you’re the main source of income for your family, do not put your spouse or children in a position where they don’t have enough money to meet their needs. This will not help your case and you will most likely be required to pay for their expenses or reimburse them for previous expenditures.
Reduce Your Debt
If you have a significant amount of debt, take the necessary steps to correct this problem as soon as possible. After separation or divorce there will be less money to go around because you’ll be supporting two households with income that previously only paid for one. Debts incurred during your marriage are marital debts—even if they are not in your name. Both of you are responsible for the repayment of any and all debt.
Collect and Organize Important Documents
It’s a good idea to start looking for documents which might be used to support you during negotiations or court hearings. Check desk drawers, safety-deposit boxes, bank boxes, or other places where documents might be hidden. Visit your family banker, stockbroker, and accountant to discuss your financial situation and to make plans for the future.
Keep in mind that while you’re searching for supporting documentation, state and federal laws prohibit hacking into your spouse’s computer or e-mail, installing any kind of spyware, listening to your spouse’s voice mail messages, or recording telephone conversations in which you’re not participating. If you obtain information illegally, it will not be admissible in court and could result in criminal charges.
Keep a Tab
Keep records of any payments you make or receive for alimony and child support as well as any voluntary support you’re paying. If you are receiving payments, keep a running account in a safe place. The court will need proof of such transactions during any future testimony.
Revisit Your Will
Can you remember the last time you updated your will? Sit down with your lawyer and draft a new one. Decisions made in the early days of your marriage will no longer apply and your will should reflect those changes.
If you have a living will (sometimes called a health care directive or advance directive) in which your spouse has the right to make medical decisions for you in the event you’re incapacitated, have your lawyer update that document as well. The same goes for power of attorney: If your spouse has been given the power to make legal decisions for you, cancel it.
Keep Medical Insurance
Concerning how a legal separation will affect your current coverage, some employers and insurance companies will stop coverage on the date of separation, as opposed to the date of divorce. Your attorney can advise how to handle the situation and what your options are. If your spouse or children are covered by your medical insurance policy, do not drop them from coverage until you have an agreement or court order allowing you to do so. You could be responsible for any medical bills incurred if you leave them uninsured.
A separation or divorce is never an easy or simple process; the life built with a spouse cannot be dissolved in an instant. The dissolution of a marriage can take some time—be sure you have an experienced lawyer on your side to guide you through the legal maze, to ensure the process goes as smoothly as possible for you, and to protect your interests while also encouraging cooperation among all parties involved.
For more information or to schedule a consultation, please contact Greene Wilson Crow & Smith by calling (252) 634-9400 or visiting nctriallawyers.com.