Eric S. Neumann, APLC
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Dealing with finances after divorce

Going through settlement negotiations or litigation and issuance of the divorce decree does not end all the financial and legal issues after the end of a marriage. There are still practical matters that must be addressed following the end of this often long and tedious process.

First, cancelling joint credit cards and establishing sole credit for one spouse is important and should be done immediately. This also prevents a former spouse for running up debt for both spouses.

Wills and other estate documents should be changed so that a former spouse does not receive an inheritance. This also applies to insurance policies, retirement accounts, pensions, trusts, annuities and any thing else where the former spouse is listed as a beneficiary.

Retirement accounts must be divided according to the divorce settlement. A Qualified Domestic Relations Order is usually needed to divide a 401(k) or other pension plans, other than an IRA. Even though splitting these plans appears equitable, one spouse may unfairly bear the burden of taxes and administrative costs.

It also important to assure that there is a means of assuring that alimony or spousal support payments are timely made. This may be though automatic transfers from a bank account or a schedule for issuance of checks.

Other matters include dealing with the family's home. If its sale proceeds are to be divided under the divorce decree, a spouse should begin the process of engaging a realtor and beginning this sale. A spouse who plans to keep the home should begin refinancing the mortgage in their name only.

New health insurance may be needed. COBRA is an option but is only temporary.

An attorney can help spouses develop an action plan for enacting their settlement or decree containing specifics on what each spouse must do and when it will be accomplished. This can help increase the likelihood that a Louisiana court will take enforcement actions against a spouse who does not comply with the decree or agreement. An attorney can also help assure that the underlying decree and settlement is fair and reasonable.

Source: Forbes, "A checklist to help you manage your post-divorce finances," By Jeff Landers, Feb. 12, 2018

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