The sudden realization that the foundation that lay beneath you and supported you now shattered leaves you immobilized. You now ask yourself, “What next?” Things can feel like they are out of control – out of your control. This is the time to find strength and take charge. Start with something you can control. The fact is there is a lot you have control over but let’s focus on your finances, for now.
Gather all the understanding you have about your finances. If you feel that you are not equipped to do this because it has never been a focus of yours, now is the time to make it a focus. You are not alone, and it is important for your immediate and distant future.
Here are the top 10 things you can do when you are facing separation or divorce to organize your finances:
1. Make a list of what you own (your assets) and what you owe (your liabilities), individually and jointly, and attach a dollar value.
2. Get organized with your paperwork. Make sure you have copies of current statements (e.g. bank accounts, investment accounts, RRSPs, TFSAs, RRIFs, credit cards, lines of credit, mortgages, insurance policies), pay stubs, and tax returns for the past three years.
3. Get key details of all and any joint lines of credit, joint credit cards and joint bank accounts. Your former spouse can continue to access and make use of any joint accounts. You may be liable for joint debts pre- and post-divorce.
4. Decide whether to keep joint accounts open.
5. Update beneficiaries for your RRSPs, TFSAs, RRIFs, CPP.
6. Consider life insurance policies and their beneficiaries.
7. Consider your budget.
8. Open your own bank accounts and credit cards if you don’t already have them.
9. Review and rebuild your credit history.
10. Update your will.
These top ten things are a start to help you to take charge of what you can control. Your bank and investment advisors can help you with statements, and to make any needed changes. Your lawyer can assist with non-financial needs. Financial information is required for your financial disclosure when faced with separation/divorce, so early preparation is helpful, but it also provides real facts you can rely on to face your future with confidence.