Couples in Maryland who are planning to divorce must prepare for all the most important matters. It’s important to avoid making certain financial mistakes during what can be a stressful period.
Not taking your expenses into account
Although you might know how much income you earn each month, it’s important to know where your money goes. Expenses are a part of everyday life, but overlooking them during a divorce can spell disaster once you’re living single. You need to go through your finances and determine how much you incur in regular expenses every month to avoid a financial shock later.
Believing equitable distribution means equal
Maryland is an equitable distribution state when it comes to property division. However, many people going through a divorce mistakenly believe that means everything is split equally between spouses. When dividing marital property and debts among you and your spouse, the judge will do so in a way they consider fair, which doesn’t necessarily mean 50/50.
Not updating beneficiary designations
Forgetting to update your beneficiary designations can cost you and your intended beneficiaries in the future. After your divorce, you should immediately update your beneficiaries. Not doing so might result in your former spouse being the one to make decisions about your medical care if you are suddenly incapacitated or being the one to inherit the proceeds from your life insurance policy.
Not securing your child’s educational future
During the end f a marriage, it’s easy to suddenly forget about putting money aside for your child’s educational future. However, if you have a 529 college savings account for your child, you have to determine whether you or your spouse are better equipped to manage it. You should always consider any effect the divorce could have on your child’s future.
Avoiding these financial mistakes can help make the divorce process easier.