Once we have established our own household it is necessary to prioritize and organize our thoughts around our finances, especially if we did not have the responsibility for them in the past. If we have children, our thoughts and actions usually revolve around them and their activities and everything else is put behind them. We only have so much time and energy to spend.
Financial abuse occurs in many forms including financial irresponsibility, complete financial control and financial deceit. In this article we will address financial safety. Every year you can get a free credit report at annual credit report.com. The report will show exactly what accounts your name is attached to so you can make sure any joint accounts are closed. You will also find out if any credit has been opened in your name of which you are unaware. If there are open balances left on joint accounts, you need to work out repayment as part of the separation or divorce agreement and then they need to be closed.
If you find that any accounts have been opened in your name without your consent immediately put a freeze on your account with each credit reporting agency; Experian, Equifax and TransUnion. You will have to contact each agency separately and create a PIN that would be used to unlock your account in the event someone is doing a credit check. This way your account cannot be accessed without your knowledge and no new credit can be opened in your name. You may want to consider doing this anyway for protection.
If your partner had access to your PayPal or any other payment accounts, cancel those accounts for now, you can always open new accounts at a later date if you need them. Change all of your passwords for accounts you had while married and make the new passwords difficult to guess. You might want to try an online password generator.
Providing you have a zero balance, close any merchant credit cards you have in your name, 2 at a time every 6 months. Then close bank credit card accounts leaving only 1 open. The fewer credit accounts you have the better it is for security. Make sure you have a debit card that would withdraw from your checking account to use in place of credit cards. Everything you can do with a credit card you can also do with a debit card; you just have to make sure you have the funds in your checking account.
If you did not do this during the separation/divorce information gathering period, the next step is to make sure you have the past 3 to 5 years of joint income tax filings. This is especially necessary if a tax professional was not used and you were not able to review the tax returns before they were filed. In the off season, after April 15, I would have them reviewed by a CPA to make sure there are no errors or misinformation that you might be responsible for as a joint filer. You may need to file an injured spouse or innocent spouse status with the IRS to protect yourself if discrepancies are found. The tax professional can help with that.
The last step for this article is to begin thinking about your financial goals. Do you have a spending plan you use and how well is it working for you? We will prepare for that in the next two posts. Do you need job training, need to renew certifications or further your education in your field? Do you have an emergency fund of 3 to 6 months of expenses? Do you have debts to pay off? What are the future needs you need to save toward? A car, a deposit for housing, expenses for your children’s needs, a college fund, begin or add to a retirement fund. What else can you think of to add to this list? Plan for time blocks of 1-2 years, 3-5 years and 5-10 years and then beyond into retirement.
Feel free to contact me through the links below if you would like personalized help. Remember, comments posted can be read by anyone reading this public blog.
Karen Ferguson
FOCUS Financial Coach
Email: [email protected]
Web page : https://www.focusministries1.org/help/financial-coaching-online
