When your marriage ends, unraveling the lives you built together can be complicated, to say the least. There are many elements involved, including property division, child custody, child support, and possibly even alimony.
A divorce is a highly emotional experience. You may not be thinking about your credit during this time, but you should. While a divorce does not directly affect your credit score, what happens during your divorce and beyond can cause your score to drop. That’s why you need to be vigilant about your finances because you want to have a high credit score as you transition from married life to living single. You will need good credit to rent or buy a house, buy a car, get a loan, and more. When your credit is good, you have many more opportunities.
Things can get especially complicated if you are older. One financial mistake can delay retirement or cause other issues. Here are some tips to protect yourself financially after a divorce.
Close Joint Accounts
Don’t wait to do this. If you and your spouse share credit cards or loans together, get those accounts closed as soon as possible. The longer you leave them open, the more of a chance your spouse has to incur more debt. A divorce does not automatically take you off any accounts or absolve you from any financial responsibility, so you need to take action. You are both responsible for maintaining the account and making payments, so if your ex makes a late payment or doesn’t pay the bill at all, you’re on the hook.
If you are divorcing, creditors should be made aware so they can take the appropriate steps to protect your accounts. You should send them a certified letter notifying them that you will not be held liable for any new debt. You should also request a current statement and balance and revoke any authorizations so that your spouse cannot incur new debt.
Update Your Address
If you move, make sure your address is up to date. That way, you can continue to receive mail from creditors and ensure that all bills are addressed to you. If you don’t update your address, mail could be sent to your old home. You’ll miss out on any bills and possibly ruin your credit.
Check Monthly Statements
Be on the lookout for anything out of the ordinary. By reviewing the monthly statements, you can check and make sure that no new debts have been incurred and that payments are being made timely.
Be Responsible With Credit Cards
Money is often an issue during and after a divorce, especially now that you have to consider legal bills. Still, you need to be responsible and make your monthly payments on your credit cards. If you can’t pay off the balance every month, at least make the minimum payments. Try to keep your balance low, as this will make your credit score higher.
Check Your Credit Reports
It’s a good idea to monitor your credit report regularly after the divorce. That way, you can see if there are things that look suspicious, such as unfamiliar accounts or high levels of debt. Checking your credit is free. You can get a free copy of your credit report from each of the three bureaus— Equifax, Experian, and TransUnion — annually from AnnualCreditReport.com. A free service like Credit Karma can also keep your credit in check.
Don’t Seek Revenge
Some people try to get back at their spouse by making large purchases and racking up credit card debt. This is never a good move, as this tactic could come back to bite you. If the court finds out, they won’t take kindly to it. They’ll have you pay back the purchases. Plus, you may lose out on other assets due to your reckless spending. So don’t let debt get out of control. Before you go on a shopping spree, take a deep breath and think about your actions and the possible consequences. You will be held responsible.
Contact Us Today
With so much going on in a divorce, you may not be worried about your credit score. However, your credit score is very important, opening the door to many opportunities in the future.
The Ohio divorce attorneys at Lawrence Law Office can help you make the right decisions after a divorce. Count on us to give you thoughtful advice. Schedule a consultation by calling 614-228-3664 or filling out the online form.