After you’ve negotiated the terms of your divorce judgment, and you are officially divorced, you will still have a lot of loose ends to tie up. One often overlooked issue that needs to be addressed, is updating your estate plan.

Generally, an estate plan will include a trust or will, a durable power of attorney, a medical power of attorney, and a deed that avoids probate. The documents that consist of your estate plan, will vary based upon your needs. However, if you have minor children, most times your estate plan will include a trust. A trust allows for more in depth planning, and staggered distributions, so that your child does not receive a windfall at the age of eighteen (18). A trust also avoids the hassles of Probate.

Most likely, if you already had an estate plan while you were married, your spouse is in the first fiduciary position for each document. It is important to change the documents, to replace your spouse with another individual.

One of the most common questions we receive is “how long do I have to wait until my divorce is final?” The statutory minimum for a divorce without minor children is sixty (60) days. The statutory minimum for a divorce with minor children is six (6) months.

That being said, the actual time that your particular case will conclude is dependent on numerous factors. One of the main factors is how disputed your case is. If you and your spouse do not agree on anything, then your case could continue on for at least a year. Another factor is the court’s schedule. Even if you have an agreement on all of the terms of your divorce, the judge may not have a hearing date available for several months.

Although the court cannot waive the sixty (60) day waiting period, the judge can waive the six (6) month waiting period, for good cause. Thus, if you have minor children, but you have an agreement on all of the issues, and it is in the best interest of the minor children, the judge can grant a divorce after sixty (60) days.

1.) Q: What is the Chapter 7 bankruptcy process?

A: If you are considering bankruptcy, we would ask you numerous questions about your income, assets, expenses, and debts. We would run your credit report to determine the amount you owe each creditor. If we find that your monthly expenses exceed your income, and your assets are within the bankruptcy exemptions, we would assist you in filing your bankruptcy petition. Once the petition is filed, a creditor’s meeting is held approximately 4-6 weeks after filing. After the creditor’s meeting is held, the Trustee has sixty (60) days to determine whether or not to discharge your debt. If the Trustee discharges your debt, then you will not be responsible for any of the debt listed in your bankruptcy petition.

2.) Q: What is the creditor’s meeting?

A legal separation and a divorce are two distinct court cases and two distinct marital statuses. Legal separation does result in a final division of marital assets but the parties are still married and therefore cannot re-marry. If you have gone through a legal separation, but you later decide you want to divorce, you can petition the court to convert your judgment of separate maintenance to a divorce judgment.

The majority of couples that decide to file for a legal separation, versus a divorce, do so for religious or medical reasons. One advantage of a legal separation is that a spouse may be able to maintain health insurance through the other spouse’s employer. Be sure to check with the employer, human resources, or the health care company directly to ensure benefits will not be suspended in the event of legal separation. One of the other advantages of a separation is that you are not considered divorced for religious purposes.

However, some disadvantages of a legal separation are the costs. It is rare for people who are legally separated to reconcile though it does happen. So, if you’re in the majority, you may want to consider saving yourself some money (and aggravation) and simply file for divorce rather than separation because the likelihood of divorce is so substantial. Another disadvantage of a separation, is that you cannot re-marry, as you are still considered legally married. Additionally, when an action for separate maintenance is filed, the defendant has the option of counter-claiming for divorce. If the defendant counterclaims for divorce, the case will be converted to a divorce case. Thus, if you and your spouse do not feel the same way about a legal separation, you are better off filing for a divorce.

A common problem for divorced couples, is that they go from a standard of living based upon two incomes, to a standard of living based upon one income. In addition, payments and debts are divided, and individuals are often left with a combination of high outstanding balances and high monthly payments.

If your expenses exceed your income, and your debt seems to be outweighing your assets, contact our attorneys at (586) 264-3756, to determine if bankruptcy may be a good option. The last thing you need after the stress of a divorce, is the stress of keeping up with bills. Let us get you the fresh start you deserve.

The Daily News has created a list of three (3) ways that parents can protect their children during a divorce.

1.) Assure the children that they have your unconditional love;

2.) Do not make children choose between parents; and

Below is a link to an article that discusses the mortgage ramifications of filing for divorce.  It is important to understand the difference between removing your name from the deed, and removing yourself from the liability of the mortgage.


Dealing with divorce: How to handle your mortgage when you split

For more information regarding dividing real property, contact our divorce attorneys at (586) 264-3756.

Many people contact our office and ask, “how do I prepare for a divorce?” If you are contemplating filing for divorce, there are a few things you can do to put yourself in the most favorable position.

1.) Prepare a financial statement. You should know the extent of the marital assets. Not only should you create a list of your individual assets, but also your spouses’s individual assets, and all joint assets. You should also know the approximate balances in each account. Start keeping track of the account statements, so that you know if your spouse has made any significant transfers. In addition, you should know all of the debt in your name, your spouses’s name, and in both of your names. If any assets have a lien, know the amount of the lien and who the lienholder is.

2.) Create a budget. You should know the current incomes and expenses of your household. You will want to figure out if you would be able to keep your home, or the amount of other comparable homes in the area, if you plan on moving out of the marital home. If you have concerns about your ability to keep your home, check out our spousal support blog, to see if you would be entitled to support.

For many couples, the bulk of their assets are located in retirement accounts. The division of these assets, and the tax consequences associated with such, is a significant concern. Generally, you are entitled to half of the marital portion of your spouse’s retirement accounts and vice versa.

The actual division of the accounts depends on the type of account. For example, qualified plans require a QDRO (Qualified Domestic Relations Order) to properly split the account and avoid tax consequences. Additionally, an IRA division needs to be treated as a transfer “incident to divorce” and should be completed within one year of the divorce agreement, in order to avoid the early withdrawal penalty.

Another important, and often overlooked, change that needs to be made, is on your beneficiary designations. You will want to make sure that your former spouse is no longer listed as a beneficiary on any of your retirement accounts, or any other asset that designates a beneficiary. Regardless of your divorce judgment or Will, a company will generally follow the beneficiary designation. Although many individuals assume this is accomplished through the Judgment of Divorce, it is not.

As long as an individual was married at least 10 years, was divorced, and is currently single, he or she can collect Social Security benefits on an ex-spouse’s earning record as if they were still married. This applies even if the former spouse has remarried.

An additional benefit for spouses born on or before January 1, 1954, is that a divorced individual can restrict their claim to spousal benefits and allow their own retirement benefit to continue to grow by 8% per year, until they attain the age of 70. Unfortunately, individuals born on or after January 2, 1954, will be applying for all available benefits. This means that they will receive the higher of the spousal benefit, or their own benefit, but do not have the option to restrict their claim.

For more information on how divorce affects retirement decisions, contact the attorneys at SMDA, P.C. at (586) 264-3756.