Divorce or Death: Are You Prepared?

Divorce or Death: Are You Prepared?

by Charla Bradshaw, KoonsFuller Family Law

Educating yourself about your estate for an unexpected divorce, or the death of your spouse, is essential. But what should you know to be prepared? Here are some examples:

  • Know all of your banks and lenders, account numbers, and make sure you are named to have access to same.
  • Know all of your investments, and the broker/manager, and have access to same.
  • Know all credit card accounts, whose name is on each account, and make sure you have access to view those accounts.
  • Know where cash is kept and how to get access to cash in an emergency.
  • Have copies of the deeds to any real estate.
  • If you own a business, know who the other owners are, where the documents regarding that business are located, and who keeps that information for the business.
  • Know where your life insurance documents are and who the life insurance agent is.
  • All household bills that have to be paid and the passwords to access that information.
  • All assets and liabilities of either spouse.
  • Know your CPA and have copies of all income tax returns: tax returns are a wealth of information about spouse’s finances.
  • Read and sign all income tax returns and don’t leave this to your spouse.
  • Have copies of all beneficiary designations on retirement and any other assets.
  • Know where yours and your spouse’s estate documents are and what attorney prepared them.

I know for some people, gathering this information may be stressful on a marriage, but the stress on a marriage is insignificant compared to the stress that can ensue in the case of divorce or death. The emotional strain in either case is overwhelming.

Unfortunately, I see this problem frequently. Spouses don’t have the basic knowledge of their accounts, where those accounts are located, the account numbers, or even what bills need to be paid. Usually, it’s because most couples have one spouse in charge of the finances, and in the case of a divorce or death, the other spouse is placed at an extreme disadvantage as they are forced to get up to speed in an already stressful situation.

If a spouse is unwilling to provide such information, and has no good reason, then that should be a red flag. Any spouse should want the other spouse to have as little stress as possible in the case of death. This just makes sense. I suggest that both spouses sit down bi-annually or annually to go over their finances, and share in the financial duties of the marriage. If a spouse suspects a divorce, they should see a family law attorney to find out their rights, and to know what kind of money will be necessary if a divorce happens.

In the case of divorce, the uninformed spouse will usually experience higher attorney’s fees simply because the information must be obtained from the other spouse. This process can become expensive if the informed spouse is unwilling to provide the information. If so, then the uninformed spouse must send a formal request under the law to obtain the information. If the informed spouse does not comply, then the uninformed spouse has to incur more costs to file a motion with the court to make the informed spouse turn over the information. The scary part is that because the uninformed spouse does not know about their finances, assets or liabilities, they have no idea what is being done to them until it may be too late.

I want to help in any way I can to get this message out. And, at the end of the day, an uninformed spouse has to step up and obtain the information. If a spouse is unsure how to go about obtaining this information, they could benefit by consulting with a family law attorney.

“The only limits in life are those we impose on ourselves”Bob Proctor

Koonsfuller | 320 West Eagle Dr., Suite 200 | Denton, TX 76201 | 940.442.6677 | 940.442.6671 fax

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