Along with emotional and personal challenges, there are often financial consequences related to ending a marriage. Before you file the divorce paperwork in Illinois, you may set yourself up for financial security by creating a comprehensive plan for your income, expenditures and assets.
According to an article from CNBC, divorce may affect several different areas of your finances, including Social Security benefits, investments and monthly income. Finalizing your divorce may involve coming to a settlement agreement with your ex-spouse. This divorce settlement may give you liability for some debts and determine whether you may continue to live in your home. You may have to make alimony or child support payments. Alternatively, you may start receiving child support or alimony payments after your divorce. You may need to develop an entirely new budget to account for your post-divorce income and expenses.
Divorce may complicate your Social Security benefits. For example, if you were married long enough, you may be eligible for spousal benefits even after your divorce. However, you may lose access to those benefits if you decide to remarry. Divorce may affect other types of retirement savings as well. You may need to start saving more toward your retirement than you did when you were married. It may also be necessary to update your estate planning documents, such as advance directives, wills and trusts. You may need to change the beneficiaries in your will. If your ex-spouse held power of attorney to make medical decisions on your behalf, you may name a new agent by creating an updated document.
This information on financial planning for divorce is intended to be educational and should not be interpreted as legal advice.