Seven Steps to Divorce Your Finances from Your Ex

Don't forget to tie up financial matters after you divorce. Our checklist will help.
Don't forget to tie up financial matters after you divorce. Our checklist will help.

Don’t forget to tie up financial matters after you divorce. Our checklist will help.

by Ginita Wall, Certified Public Accountant (CPA), Certified Divorce Financial Analyst (CDFA), Certified Financial Planner (CFP®)

Even in the best of circumstances, a divorce is a long, arduous, and emotional task. As soon as you finalize the divorce, you might just want to curl up in bed for a few weeks and watch every single thing on Netflix. Not so fast! Now that you and your ex have uncoupled your married lives, it’s time to uncouple your financial ones at well. As you begin to walk your own path, you must ensure that you are now solely in control of your finances, including your bills, insurance policies, and estate planning documents. Pause that Netflix show, you have some financial divorcing to do!

Ginita Wall Divorce Financial advice San Diego 858-472-4022

Ginita Wall

  1. Separate Your Bank Accounts and Open Your Own

If you and your spouse held joint bank accounts, it is time to close those suckers out and open your own accounts. This will allow you to control your own money and will help you both avoid inequities in spending within the shared account.

  1. Re-Route Direct Deposits and Direct Bill Pay

Now that you have your very own checking and/or savings accounts (I recommend both), you need to make sure that your automated deposits and bill pay go to the right place. You are going to be mighty unhappy if your next paycheck tries to go into the joint account you just closed, and your electric company won’t appreciate trying to pull your monthly payment from a non-existent account. Make a list of all the automatic payments that go into and out of your joint accounts and then make sure to re-route the ones you are responsible for.

  1. Deactivate Joint Credit Cards

It might be tempting to put some last-minute charges on a shared credit card, but it is best to resist. Instead, open new credit cards in your own name first and then work with your spouse to close down all your shared cards. You two will need to work together if your shared cards have a balance. Most credit card companies allow you to transfer part or all of a card’s balance to a new account, and many actually offer special promotions with low or zero introductory interest rates on transferred balances. As with your online accounts, make sure you re-route any automatic payments from your old credit cards to your new ones.

  1. Remove Your Ex from Your Insurance Policies

Unless your divorce agreement provides otherwise, it’s time to boot your ex off of your health insurance policy, car insurance policy, and renter’s insurance. Make sure to let him or her know what you are doing so he isn’t surprised to learn he doesn’t have insurance after a car accident. If you are on your ex-spouse’s insurance policies, don’t bet on him paying your premiums unless that was part of your settlement. Time to start shopping for your own insurance policies. (Learn about how to Maintain Your Health Insurance After Divorce).

  1. Make Sure Your Ex Isn’t Your Beneficiary

During the good days of your marriage, you probably made your ex-spouse the beneficiary of your life insurance policy, your retirement accounts, the trust that holds your inheritance, and perhaps your entire personal estate. Unless you two somehow managed to stay best friends, chances are you don’t want him to benefit financially from your demise. Schedule some time in the near future to remove him as your beneficiary from these documents. (Learn more about Estate Planning for Women).

  1. Remove Your Ex From the Title of Your Assets

Is your spouse listed on your car title or the deed to your house or other property? If you received these items as part of the divorce settlement, you’ll want to make sure that yours is the only name on those important documents. Transfer your vehicle title to your name and record an Interspousal Transfer Deed to remove your spouse from the house deed once all other ownership arrangements have been made (for example, you’ve paid him to buy him out his share of the home).

  1. Create a New Will

One of the most important things you need to do now is make sure that your financial legacy goes to the right people in your life. If your ex-spouse is the prime beneficiary of your will or is listed as your agent in your durable power of attorney, you’ll likely want to update both of these documents. This might mean giving your estate planning attorney a call or filling out new online templates.

Yes, tying up all of these loose ends is a lot of work, but it is also worth the hassle. Financially divorcing your spouse after your official divorce will put you on more solid financial ground and give you a clear path ahead as you begin to rebuild.

Date of Separation and the Collaborative Divorce Process

There are so many financial implications to divorce including the date of separation. It is best to work with expert divorce attorneys and financial professional on your side.
There are so many financial implications to divorce including the date of separation. It is best to work with expert divorce attorneys and financial professional on your side.

There are so many financial implications to divorce including the date of separation. It is best to work with expert divorce attorneys and financial professional on your side.

by Frann Setzer, Esq.
MBA/Certified Family Law Specialist
The Law Office of Frann Setzer, APLC

In some dissolutions, the date that parties separate is a crucial issue. This is because by law, the marital ‘community’ ends on the day when parties separate. The end of the marital community means that income earned or possibly property purchased after that date might belong to only one person. The date that parties separate also determines the length of the marriage, which potentially affects the length of spousal support or whether or not spousal support can be terminated.

Attorney Frann Setzer

Family law attorney Frann Setzer

While each situation is different, the date of separation can be a very contentious issue in a divorce.

For example, let’s say that Ms. Smith is the primary wage earner for her family. She believes she and her husband separated in January 2015, when she packed most of her belongings and began to spend many nights at her friend’s house and on the sofa at her office. Ms. Smith did return to the marital home for dinner at least twice a month. The couple also decided not to tell very many people about their impending divorce. Mr. Smith works, but earns approximately 20% of Ms. Smith’s income. He believes that the parties separated in August 2015, when Ms. Smith finally rented an apartment.

In March 2015, Ms. Smith received approximately $500,000 in commissions from work that she did from January 2015 until March 2015. Since Ms. Smith believes the date of separation was January 2015, she also believes that the $500,000 is her separate property.

Conversely, given his belief that they separated in August 2015, Mr. Smith believes the $500,000 is community, making him entitled to $250,000. To complicate matters further, in March 2015, the parties would have been married for 10 years. Under California law, a marriage of 10 years or longer is considered ‘long term,’ which could greatly affect spousal support.

The facts of this particular situation are such that, a court could find for either party in terms of a date of separation. It could be January or August. One person ‘wins’ and one person ‘loses.’

Does this sound complicated? The above situation occurs more often than you might think. Many people do not wish to be a part of the adversarial world of litigation, where the outcome is all or nothing and where they risk making enemies of each other.

Enter the Collaborative Divorce process, where clients can meet with their attorneys, divorce coaches and their financial neutral and craft a solution to a very complicated situation that works for them. Their attorneys advise them of the law, their coaches get them to examine their true goals and the financial neutral can examine their needs. A global solution can be reached that takes into account property as well as support. Complexity is not the issue, the willingness of the parties to listen to each other and reach an equitable solution is the definitive factor.

Collaborators Support Kids’ Turn San Diego

The Collaborative Family Law Group of San Diego support Kids' Turn San Diego, which gives children a safe place to talk about their experiences and feelings when experiencing separation from parents due to military deployments, divorce, and other challenges.

Both groups share commitment to children navigating family separations

Contact: Gayle Lynn Falkenthal, APR / 619-997-2495 or gayle@falconvalleygroup.com

The Collaborative Family Law Group of San Diego support Kids' Turn San Diego, which gives children a safe place to talk about their experiences and feelings when experiencing separation from parents due to military deployments, divorce, and other challenges.

The Collaborative Family Law Group of San Diego support Kids’ Turn San Diego, which gives children a safe place to talk about their experiences and feelings when experiencing separation from parents due to military deployments, divorce, and other challenges.

(SAN DIEGO) – More than 30 years of research continues to reveal negative effects of traditional divorce on children. Many of the 1.5 million children in the U.S. whose parents divorce every year feel as if their worlds are falling apart. Divorcing parents are usually very concerned about the welfare of their children during this troublesome process. Some parents are so worried that they remain in unhappy marriages, believing it will protect their offspring from the trauma of divorce.

Among the many positive aspects of Collaborative Divorce for families is lessening the potentially harmful effects of divorce on children. The Collaborative Family Law Group of San Diego shares this mission with Kids’ Turn San Diego, a nonprofit organization assisting children and families through separation due to divorce or military transitions.

The Collaborative Family Law Group of San Diego has signed on as a sponsor for the third year for the Kids’ Turn San Diego Fourth Annual “Night at the Padres” Event on June 4, 2016, with proceeds benefiting its programs bringing peace to children experiencing these difficult family issues.

“The Collaborative method of divorce came about when attorneys, financial advisors and mental health professionals saw the need to better protect the integrity of family relationships, especially where children are involved,” said Myra Fleischer, family law attorney and Collaborative Family Law Group of San Diego president. “Collaborative Divorce offers a healthy way to help children through divorce.

“Kids have a safe place to talk about their experiences and feelings at Kids’ Turn San Diego. They meet other children dealing with similar challenges in their lives, so they don’t feel so alone. Caring adults offer effective coping strategies to help the children navigate these major family changes in a positive way,” said Fleischer. “We applaud the group’s work. It is important to us to support these efforts.”

Cindy Grossmont, LCSW, Kids’ Turn San Diego Executive Director, said, “We thank the professionals of the Collaborative Family Law Group of San Diego for their ongoing support. We know the members share our mission and we value our partnership to help children make their way toward a healthier, happier future.”

To support Kids’ Turn San Diego through “Night at the Padres,” by purchasing tickets or making a donation, visit the donation page here.

About Kids’ Turn San Diego

Kids’ Turn San Diego is a caring nonprofit organization for children and parents experiencing family separations or military transitions. We offer specially designed programs facilitated by trained and experienced mental health professionals and credentialed teachers for never married, separated and divorced families, step-parents and children and families experiencing military related transitions. Visit http://www.kidsturnsd.org/ to learn more.

About The Collaborative Family Law Group of San Diego

Collaborative Family Law Group of San Diego members work together to learn, practice, and promote collaborative processes for problem solving and the peaceful resolution of family law issues, with an eye toward preserving the emotional, as well as the financial, assets of the family. Its goal is to transform the resolution of family law issues through respectful, collaborative processes that protect the integrity and health of family relationships and eliminate the need for families to resort to litigation.

CFLGSD is online at www.collaborativefamilylawsandiego.com.

 

Choose Your Divorce Date

Attorney Carol Severance

by Carol Severance, Attorney at Law and Certified Family Law Specialist

You chose your wedding date and you and your spouse can choose your divorce date.

Some people think the day the Judge signs your Judgment is the day your marriage terminates. But that’s not always true.  Spouses have some control over that date.

Attorney Carol SeveranceA Judgment is an enforceable order that finalizes the terms of your divorce. It’s sometimes known as a Divorce Decree. But in your Judgment, spouses can choose the date to end their marriage with some guidelines:

  1.  In California, you have to wait at least six months from the date divorce papers are served on a spouse to terminate the marriage. But you and your spouse can pick a date that is after that six month period.
  2. You have to pick a date that allows the Judge enough time to sign your Judgment before the date you select. Your attorney can help you choose that date to allow enough time.

You don’t have to pick a date. If you decide it doesn’t matter what date the marriage is terminated, the Court will just fill in the date for you after the six month period.

Five reasons why you might want to choose your own date:

  1.  Getting health insurance when you need it. If you need to get health insurance, start your health insurance on the date you terminate the marriage.  So there’s no guessing. You will know exactly the date you need it.
  2. Avoid the wrong date. If your marriage ended on your birthday, or your child’s birthday, it would not be a date you would have chosen. So you can mutually pick a date to avoid this from happening. It may not be a reason in itself, but if you are choosing the date anyway, you can avoid meaningful dates you don’t want ruined.
  3. Tax purposes. Your marital filing status for tax purposes is determined on the last day of the year. If spouses wish to file married filing jointly, they should pick a date at the beginning of the following year to terminate the marriage, so they can file married for the current year.
  4. Social Security benefits. The ten year mark is significant for social security benefits. So if you’ve been married for nine years, you might choose a date after you have been married for ten years, just to be eligible for derivative social security benefits. This may not be beneficial to all spouses, but if it is, you should secure those benefits.
  5. Immigration process. People working through the legal immigration process may wish to delay the termination of the marriage until the process is complete.

You may even decide to decide later. This means you can submit a Judgment for a Judge to sign, but leave the date open to terminate the marriage. For example, your spouse is being treated by a doctor and does not wish to switch doctors. So the spouses choose to stay married until treatment is over. If you don’t know when the treatment is ending, you can agree to decide on that date later.

Be aware there may be downsides to delaying a termination of marriage, such as liability for your spouse’s debts and accidents, or lawsuits that may expose both spouses to liability. You also are unable to remarry until your marriage is terminated.  On the other hand, if one or both spouses may benefit , you can mutually choose your own date.

By working with your spouse in a collaborative process, you can work together with your attorneys to open up more options that may be beneficial to you. This is just one more way that collaborative divorce may work best for you and your spouse.