By the time the judge pronounces you divorced, you are so glad that the whole ordeal is over that you don’t want to have anything to do with divorce, courts, lawyers, and quite possibly your ex, for a long time! Yet, even though diving into more paperwork and legal mumbo jumbo is the last thing you feel like doing, not tying up the loose ends that remain after your divorce is final can turn out to be a big mistake later on.
Here are 10 things you need to do after divorce so that you can really put your divorce behind you.
1) Separate all bank accounts that remain in both of your names. While going to the bank with your ex is probably the last thing you feel like doing on the day you get divorced, doing exactly that is absolutely the best idea for your future financial security. The more time goes by, the more chance there is that money will be deposited into, or withdrawn from, the account, thereby complicating your calculations and changing the amount that is left to divide. Plus, the longer a joint account is left open, the more tempting it is for one of you to take out more than your fair share.
2) Redirect all automatic deposits, and all automatic payments, from your joint bank account into your individual bank account. You do not want your paychecks to continue to be deposited into a bank account to which your ex has access after your divorce (unless you agreed to that as part of your divorce settlement.) While you may not mind letting your automatic payments continue to be deducted from what will now be your ex’s account, doing that is only going to cause a conflict. Life will be much smoother if you just redirect all of your automatic banking transactions as soon as you can, and move on.
3) Make sure that all joint credit cards are either closed or that they are put into one person’s name only. The cleanest way to separate your credit from your ex’s is to close out all of your joint credit cards. Sometimes, though, that is not possible. Sometimes one of you may want to keep one of the credit cards in just your name. To do that, though, you may have to pay off the balance due on that card before the credit card company will let you close the account or take one of your names off of it. Also, you want to make sure that your ex diligently takes your name off all credit cards in his/her name as well.
4) Have your spouse removed from all of your insurance policies. This includes your car insurance, homeowners or renters insurance, health insurance and any other insurance you may have. If your ex is the one who carries all of the insurance, make sure you get your own insurance lined up for your home, health, and car as soon as possible. If you and your ex are getting along, resist the urge to “help out” by keeping him or her listed as an insured on certain policies. Once your spouse’s status changes from “spouse” to “former spouse” the insurance company may no longer allow you to be listed on the same policy. Check with your insurance agent to find out what is possible before you pay for coverage you may never be able to use.
5) Change the beneficiary designation on your life insurance policies, 401(k), and investment accounts. Just because you are divorced, that does not mean that your spouse will automatically be removed as the beneficiary on your life insurance, 401(k), or other accounts. Even if your divorce judgment says that your spouse gives up all beneficiary rights in anything you own, the company that manages your life insurance, retirement, or investment account doesn’t care. That company will pay the benefits due on your death to the beneficiary named in its paperwork. That is why it is so important for you to change the beneficiary on all of these accounts yourself after your divorce.
6) Make a new Will. Many divorce judgments specifically state that both spouses can no longer inherit anything from each other after they are divorced. Even still, once you have gone through a major life change like divorce it is important to take a look at your old Will (if you can even find it anymore!) and to take the time to consider what you want to happen to your estate now after you die. If you DO want your Ex to inherit something from you, then it is even more important that you make a new Will affirming that. Otherwise, your wishes can be deemed to be unclear, and the only thing you will leave upon your death is an enormous mess for your heirs and your ex to fight over.
7) If you are a woman and taking your name back, you will need to file the forms to change your name. Sadly, doing so is not easy. You need to fill out and submit separate forms with the following offices:
a) The Social Security Administration.
b) The DMV or Secretary of State’s Office to get a new driver’s license.
c) Every credit card company where you have a credit card in your married name.
d) The U.S. Department of State to get a new passport.
8) Transfer titles to any vehicles that will now be solely in your sole name, or your spouse’s sole name. Obviously, you want to be clearly established as the owner of any vehicle that you were given as your property in the divorce. You also want to make sure that your name is removed as an owner of your ex’s vehicle. Otherwise, you could potentially be facing liability as a vehicle owner if your ex gets involved in an accident. (It’s not a huge risk, but why take a chance?)
9) Transfer funds from your retirement accounts in accordance with your agreement. Dividing most kinds of retirement plans, such as 401(k)s, 403(b)s, SEPs, and Pension Plans, require a special court order called a Qualified Domestic Relations Order (QDRO), to effectuate the transfer. These court orders are highly technical and are best done by an attorney or a QDRO specialist. What is important for you to know is that these orders are one of the things you need to do after divorce as soon as possible. (You can even submit them to the court on the day of your divorce if you have them ready.) Until these orders have been entered in court and processed by the Plan Administrator, the retirement money that you were supposed to get in your divorce may never be transferred to you. (NOTE: IRAs are different. Transfers from IRAs generally don’t require a QDRO.)
10) Complete any necessary real estate paperwork. If one of you is buying the other one out of the house, make sure that title to the house is transferred, and that the Quit Claim Deed is recorded. You will also want to make sure that the mortgage and all home equity loans are refinanced to remove the name of the spouse who will no longer own the home. You also will want to make sure that your name is taken off the property tax collector’s records too. (Simply quit-claiming title to a piece of property may not be enough to change the tax collector’s records.)
Doing all this paperwork after you have already done all of the paperwork involved in your divorce is an enormous pain in the behind. Unfortunately, these are all things you need to do after divorce to truly put it behind you. What’s more, the mess that you will create by not doing them will be way worse.
Karen Covy is a divorce attorney, advisor, mediator, and coach. She is the author of When Happily Ever After Ends: How to Survive Your Divorce Emotionally, Financially and Legally. To read more divorce advice from Karen, you can check out her website at https://karencovy.com.