Divorce can be a difficult and stressful process. And approximately 80% of the couples in Canada go through a divorce, which is a lot. We can never tell if we will be one of that 80%; we can’t predict the future. But if you go through this process, know that it is essential to learn financial management; before, during, and after divorce.
If anything, consult your credit repair advisor.
Financial Management Before Divorce
Divorce doesn’t happen instantly. You will feel it when your partner starts to drift away, and you’re on the verge of separating. If you are wise enough, you will start separating your finances and gathering financial documents.
If you have joint accounts, keep them open to pay for household finances. However, it would help if you also started opening sole accounts. Credit card and saving accounts in your own name. Just keep in mind that you have to make sure your joint account balances are paid on time and in full to
strengthen your credit score as an individual.
It is also wise to gather financial documents as early as now.
Financial Management During Divorce
During a divorce, you must get trusted legal advice. Lawyers can be expensive, but that doesn’t mean the more expensive they are, the best advice you can get. It would help if you started talking to multiple lawyers until you found someone you could trust. You could start by getting recommendations from family or friends.
Your lawyer can help you understand your rights and obligations and provide advice on money management in divorce. Getting legal advice is essential, especially if children are involved in your marriage, there is marital property to divide, and/or a significant difference in the assets and income of spouses.
Create a detailed divorce agreement.
It is also essential that you create a detailed divorce agreement. Your lawyer can help you with that, but it is important that you already know what you want to write on the agreement, so your lawyer can understand your choices quickly. And lawyers charge hourly; if you know what you want, it will be finished quickly.
Make your home decision.
The home you lived in as a married couple can be a crucial and sensitive topic. You both grew attached to it, and there are so many memories there, but you have to talk about your home correctly.
If one party decides to stay in the house, you will have to complete the mortgage on your own now and re-qualify to carry the mortgage alone; you may also have to pay the other party for their part of the home’s equity.
You also must prepare yourself for possible legal fees for your new mortgage and the charges required to remove the other party from the title and deed documents.
If you are moving out, you have to update the joint mortgage to remove you as one account holder.
If you decide to sell the home, you must split the proceeds equally.
Financial Management After Divorce
Updating your will, insurance, and beneficiaries is an overlooked yet essential part of financial management. Talk to your lawyer if you want to update your will. And talk to your insurance company to update your insurance. Also, updating investment accounts or pension that has beneficiaries should be updated as needed. If you pass away, your ex-spouse will be the beneficiary of all your assets. If your fail to update your will, insurance, and beneficiaries.
Opening new saving accounts after divorce is also essential. It will help you boost your credit score. Before closing joint accounts, you should have new accounts to build your credit.
And speaking of credit score, you should check your credit score after divorce. So you’ll know how and where to start building or maintaining your score. Checking for any incorrect information on your credit report can affect your credit score.
If you need credit repair services, you can send us an email or call us to book an appointment with our credit agent.
Get your free credit score on credit bureaus. Canada has two, TransUnion and Equifax,
Re-title assets on your name
For instance, if you have assets and have your ex-spouse as a trustee, you may want to rename your assets on your personal or have another living trustee.
Conclusion
Divorce will shake your whole world. Your finances, your time with your children, day-to-day living, and even your home. It’s like going back to square one, and it’s really stressful. It’s unpleasant.
That is why preparing your finances before divorce is really essential. Saving as much money as possible, especially with kids, will be challenging.
Most importantly, keep your credit score in check. It will be a big help when you have to find a new place to stay or need a new personal credit account.
In Credit Repair Now, we fix credit. If you need any help, you can always send us an email, or you can call us on our number. We answer right away.
