Protect Your Finances During a Divorce

Reduce Unnecessary Expenses Immediately

- Meet with your spouse and agree to cancel unneeded utilities, such as cable TV, extra telephone lines, etc. Chances are, you're going to need money in the very near future. Sell personal property you don't want or need like cameras, VCR's, extra vehicles, etc. Do this now, because as soon as you're legally separated these items may be considered "Community Property", in which case you may not be able to sell them even though they're yours.

Cancel All Jointly Owned Credit Cards

Meet with your spouse and inform them that you intend to cancel the cards before you do so. It only takes five or ten minutes to cancel your credit cards, and in that same five or ten minutes, your spouse could charge $5,000 on them. If the card is jointly owned, YOU will have to pay some (or more likely ALL) of that $5000 credit card debt. If your spouse already has the cards and has started to go on a spending-spree, report the cards as stolen. The card will be canceled and you may only be liable for the first $50 of whatever charges were put on the card.

Safeguard All Jointly Owned Bank Accounts

A very common act by angry spouses is to "clean out" a joint account, leaving you with nothing. Remove one-half of the balance of the account, and inform your spouse in writing that you've done so. Make arrangements with your spouse to ensure that any outstanding bills are covered. By taking one-half of the account balance, you are claiming what is rightly yours without "playing dirty", and without attempting to financially ruin your spouse. If you open up a new account, do it at a different bank; don't stay with the same banking company.

Stop Contributing To Any IRA's, 401(K) Accounts Or Pension Plans

Usually this is done by simply signing a form at your place of work. There's a good chance that (assuming you don't spend it) some or all of the money in your pension plan or retirement account will be given to your spouse as part of the property settlement, so don't put any more in there. Stopping contributions to pension plans and the like will also put a little more money in your paycheck each week, and chances are, you're going to need it.

Divorce