A common misperception among those working through a divorce is that the work is over once the divorce is final. After the decree is entered, there are still a number of steps Kentuckians should take to prevent legal and financial complications down the road. Take the time to understand your duties under the divorce decree. Then, take a few commonsense steps with your attorney and others:
1. Your Home & Other Property – It’s essential that you execute a quitclaim deed to transfer title of real estate properties (land, homes, buildings) to your former spouse, and/or your ex-spouse does the same. If you do not follow through with the division divorce decree, you could be held in contempt of court. Delaying or ignoring this action could also prevent you from refinancing or obtaining a new mortgage in the future.
2. Estate Planning – You will likely need to change important parts of your Last Will and Testament. There will be new beneficiaries, trusts for children under 18, possibly a new trustee, and a new executor. The most important step you can take is protecting your children and beneficiaries. Don’t delay this. If necessary, ensure that your family (i.e. parents or siblings) remove your ex-spouse from their estate plan documents.
3. Power of Attorney and Healthcare Surrogate – Your Living Will should designate a new healthcare surrogate should you become incapacitated. Your Power of Attorney should also be updated, if necessary.
4. Open New Banking and Credit Card Accounts and/or Close Old Joint Accounts – If you did not complete this process during the divorce, do not forget to do it after. Run a credit check to better understand joint liabilities, loans and accounts.
5. Employee-sponsored Retirement Plans – A Qualified Domestic Relations Order or “QDRO” is a special order entered by a family court to divide retirement assets or pension plans. Pensions and IRA’s are governed by federal law (ERISA), so they must be divided by a QDRO. Also, notify your employer of your change in marital employer status.
6. Update Your Beneficiaries – Don’t forget to change your life insurance, retirement plan, and annuities beneficiaries.
7. Safe Deposit Boxes – Close held safe deposit boxes and retrieve the items that belong to you.
Divorce can be painful and emotional, but untangling financial and legal arrangements is extremely important when closing one chapter of your life and beginning anew.
Megan Cleveland is an Associate with the Kentucky law firm of Goldberg Simpson. Her primary practice area is Family Law. She can be reached at [email protected]