During the time of transition that takes place following the dissolution of a marriage, some heavy financial decisions have to be made in Texas. These decisions affect not only the recently divorced party but also possibly his or her children, and they can have lifelong consequences. A few tips may help with addressing some of the most critical financial matters following divorce.
First, it is essential to update all accounts following the finalizing of the divorce. This task involves contacting financial institutions, brokerages or banks to change accounts that were once jointly held into accounts that are now only in one’s name. The necessary guarantees and signatures need to be provided to the financial institutions to change the ownership of each account.
Regarding retirement savings, divorcees usually have certain legal arrangements spelled out in their divorce settlement documents that acknowledge recipients’ right to get portions of their ex-spouses’ retirement account balances. In a transaction that the court approves, an IRA is divided via a distribution from the account of one party to that of the other. Tax advisors may be helpful for understanding all tax implications of an IRA prior to the moving of these retirement assets.
When going through divorce, sometimes it seems easier to remain disconnected emotionally and mentally from the stressful process. However, doing so can make it easier to make mistakes that have negative long-term repercussions. An attorney in Texas can provide guidance with making weighty financial decisions, such as property division, during this type of legal proceeding.
Source: tdameritrade.com, “Caring for Your Finances When You’re Suddenly Single“, Jennifer Waters, May 8, 2017