If you divorce or your spouse dies

If you find yourself recently single, whether divorced or widowed, there are certain steps you need to take right away to protect your finances. Losing a spouse through death or divorce can be an emotionally devastating time for you and it’s common for people to put their finances on the back burner while they attempt to get themselves back together. Unfortunately, this is a time when many financial matters require your immediate attention and you really can’t afford to put them off until you’re ready to face them.

At the same time, it’s far too easy to let your emotions drive your decision-making process, which can be harmful to your long term financial future.

If you do find yourself suddenly single, here are five important steps you can take to help protect your finances for the next chapter of your life:

1. Seek professional help before dividing or amalgamating assets

Pension and retirement accounts all come with their own set of rules, and if divided improperly, could create a lot of unnecessary taxes.

On the other side, a deceased spouse’s accounts should roll over to your name with little or no taxation but the proper steps must be taken.

Make sure you consult with a financial professional before agreeing to anything with an ex-spouse or lawyer. 2. Create a new budget Finding yourself suddenly single might mean a reduced household income.

It may also mean lower or higher monthly expenses. Taking stock of your new income situation and putting together a realistic budget of your essential expenses will go a long way to easing your anxiety over your financial future. 3. Build a brand-new financial plan With the above budget in hand, you can take this financial summary and start work on your new financial plan.

Now would be the time to create a full financial plan that considers what assets you have, how they’re invested, what you’ll need to reach your retirement goals and how you plan to deal with any remaining debts. 4. Review your credit Finding yourself suddenly single, your credit score can become a very important number.

You might need to apply for a new mortgage or loan at some point soon and you need to make sure your credit is intact.

Request a copy of your credit report to take inventory of all the accounts that are open in your name or owned jointly with your former spouse.

In the case of divorce, you want to make sure all jointly owned credit accounts are closed before finalizing a separation agreement and in the case of being widowed, contact both credit bureaus to let them know so nobody can falsely establish credit in your late spouse’s name. 5. Evaluate your insurance needs Confirm if you are able to carry on health insurance in your former spouse’s name.

You are on your own now, so a review of disability and long-term care insurance is also in order as you may need to establish or add to these plans to ensure you’re covered adequately.

You should also review your life insurance as you may want to decrease, cancel or change beneficiaries on policies you have.

As stated above, losing a spouse can be a very difficult and emotional time.

Seek out the guidance of a certified financial planner who can walk you through each of these steps and make sure that you move forward on the right track.

Brett Millard is the owner of Speir Wealth Management in Kelowna. Reach him at brett@speirwealth.com.