The financial implications of divorce could derail a person’s long-term goals. In fact, legal fees and separating assets may leave an ex-spouse with a lot less than they need to retire. By reevaluating goals and adjusting targets to reflect the new status, someone who was recently divorced in Illinois may be able to get back on track and regain financial independence.
Credit reports are a good place to start when one wants to know how much debt they actually need to repay. Regardless of what the divorce decree might say, creditors could still pursue former spouses to collect on joint debts. A thorough review of debts prior to finalizing the divorce could help a spouse avoid taking on more than their share of the marital debt. If getting divorced means using retirement funds or having to transfer some of a retirement account to a spouse, it’s important to make up for those losses by increasing contributions as soon as possible.
Divorce may also mean beneficiaries need to be changed on life insurance policies, debit accounts and retirement plans. Married couples typically give each other powers of attorney. Forgetting to update these documents could have serious consequences. Everyone should review their estate plan when they experience a major life event like divorce. Updating important documents could protect assets so that they go to the intended heirs.
Finances play a major role in divorce. From the money both spouses pay to attorneys to the higher costs to maintain separate households, it’s often challenging to get back on track. An experienced divorce attorney could help a client evaluate their finances so that they might be able to budget their remaining funds and plan for the future. With careful planning and help from professionals, one could recover or even thrive after a financial setback such as divorce.