Financial Organization 101
A divorce can be an extremely difficult time in someone’s life. First and foremost, tell yourself that everything will be okay and that you will make it through. Financial organization is key to a less stressful divorce process.
Here are a few documents that you should have on file, (virtual/physical) in order to make the legislative and financial process a bit easier. You may not have all of this, and that’s okay! You are ok.
Here we go!
Legal Contracts – Keep all original signed copies! These include:
- Wills, Power of Attorneys, Health Care Proxies, Living Wills, Letters of Intent, Trusts
- Employment contracts, Non-Competes, Shareholder Agreements, Partnerships
Insurance Policies – Keep full policies and last 1 year paid bills. These include:
- House, Renters, Car, Boat, Jewelry, Umbrella, Flood
- Individual Life, Disability, Long Term Care, Cancer, Dental, Vision, Accident, Critical Care, Specified Illness, Pet
- Group Benefits – Health, Life, Dental, Short Term Disability, Long Term Disability, Supplemental Disability, Long Term Care, Vision, Travel
Investment Statements – Keep at least 1 year of Annual Statements. These include:
- Education – UGMAs-UTMAs / 529 Plans / Educational IRAs / CDs or Bonds
- Retirement not at work – Traditional IRA / Roth IRA / Annuity / Pension / Old 403B or 401K still at last Employer
- Retirement at Work – Simple / SEP / 403B / 457 / ESOP / Profit Share / 401K / Defined Benefit Plan / Deferred Compensation
Important Documents: Make virtual copies of your most important documents. Make sure that you have all of your and your children’s:
- Identification cards – Originals or copies: Birth certificates / Social Security Cards / Passports / Resident Cards / Driver’s License / Professional License …etc.
- Deeds – Cars / Vehicles / Real estate
- Certifications / Licenses
- Annual Budgets – Store at least 3 years worth
- Meeting notes with Advisors
Contacts for Reference: We suggest that you keep an organized file of all your necessary contacts, whether legal, medical, financial or more. Here are a few to think about:
- Legal – Real Estate / Trust and Estate / Employment
- Financial – Financial Planner / Financial Advisor / Insurance Representative (Property and Life) / CPA or Accountant / Banker
- Medical – General Practitioner / Gynecologist / Dentist / Ophthalmologist / Nursing Service
- Family – Household / Immediate / Distant
- Service Providers – Nannies / Tutors / Babysitters / Schools / House keeper
Compile a list of Debts: Keep a clear record of what you owe. Use tools like Mint.com to aggregate your financial accounts and figure out exactly what your assets and debts look like. Check for things like:
- Credit cards – keep 1 year of statement per card and a copy of the front and back of card in case lost
- Mortgages
- Car / Vehicle Loans
- Student Loans
- Personal Loans
- Bank Loans
Compile a List of Assets:
- Real Estate – Include Primary residence / Rental properties / Times Shares / Vacation Homes
- Licensed Vehicles – Cars / Boats / Motorcycles …etc.
- Collectibles – Art / Books / Coins / Stamps / Sports Memorabilia / Autographs / Antiques …etc.
- Storage – Post Office Boxes / Storage Units / Garages
- Receipts for Large purchases – Jewelry / Appliances / Furniture / Electronics / Computers …etc.
Compile a List of Non-Marital Assets and their Present Value: These are your assets and ones that should not be shared in the divorce.
- Inheritance
- Assets from previous marriages
Compile a Detailed List of Cash Flow Needs: This will enable you to know exactly what you spend and what you will need to sustain your lifestyle.
- Breakdown all expenses monthly
- Prepare a cash flow statement for you to use as you are going through divorce
- Include new expenses that might occur
Review Current Wills and Trust Documents:
- Change beneficiary
Taxes:
- Determine who will be responsible for tax payments
This may seem like an overwhelming task, but when you’re done, trust me, it will be worth it. If you need help with the organization of your documents, we can help you!
Stacy Francis is the President of Francis Financial, Inc., an independent, fee-only wealth management firm specializing in personalized financial consulting for higher net worth individuals and families. She is a Certified Divorce Financial Analyst (CDFA), completed specialized training in the financial issues of divorce through the College for Divorce Specialists, and serves on the board for the Association of Divorce Financial Planners
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