If you’re going through a divorce in Canada, there is plenty that you need to plan and think about. Although your emotions may be spiralling, it’s important that you take a step back and assess your situation as there are critical decisions to be made, especially if children are involved.
Preparing for divorce in Canada or elsewhere can be overwhelming. We have broken down some items here that you may not have considered for your divorce financial planning.
- Separate Finances
You may have looked into dividing your property, but what about your finances? If you have a joint bank account, consider separating it. You want your own account and to have any payments you receive going into it. Make a budget for how much you’ll need each month to live on your own, or with your children if kids are involved. Protect your credit rating by freezing or closing joint credit cards and by blocking your spouse’s access to other joint credit, such as home equity loans or lines of credit. If you think you may be the party in the marriage that has the most debt and are worried how you will manage, consulting a professional who can look at your debt will be critical.
- List Assets & Debt
Make a list of assets (all assets count as property — including cars, jewelry, household furniture, and businesses) and debts. If taxes are owed, ensure they are paid. If you are unable to be pay them, take copies of any notices of assessment.
- Copy Important Documents
Canada Pension Plan statements, wills and trust agreements, insurance policies, business statements, bank accounts, tax returns, loan documents, etc. — make sure you take copies of all of these documents. It may seem tedious, but it could help you in the long run if the divorce becomes contentious and for assessing your financial situation.
- Keep Spending in Check
It may be tempting to rack up a large credit card bill with a shared card, but it’s not a good idea. Savings and personal finances are more important than ever when going through a divorce and you do not want to put yourself in a precarious position due to an impulsive spite purchase. It’s also best not to create any additional debts or make any large purchases. If you were thinking of buying a new car or boat, perhaps hold off until everything is finalized and you can see what you are left with.
- Transfer Your Mail
If you and your spouse are still living in the same house, have your mail forwarded to another address — either a post office box, or the home of a trusted friend or relative.
Be sure to have a divorce financial plan in place. Even the most amicable divorces can turn sour if it becomes contentious.
If you are going through a divorce in Canada, Spergel can help you assess your financial situation and manage outstanding debts.
Call us today for a free consultation: 310-4321.