Getting divorced brings major changes to your financial situation that require careful planning and smart decisions.
A solid post-divorce financial plan helps you regain stability, protect your assets, and build toward your new goals independently.
This guide covers the key financial steps to take after divorce in Edmonton and provides practical advice for securing your financial future.
First Steps After Divorce
- Close joint accounts and open new individual accounts
- Remove ex-spouse from credit cards and insurance policies
- Update beneficiaries on life insurance and retirement accounts
- Get copies of your divorce decree and settlement agreement
- Obtain a copy of your credit report
Creating Your New Budget
Track your new income and expenses as a single person for at least 3 months.
Account for changes in housing costs, utilities, insurance premiums, and other living expenses.
Set aside money for emergencies – aim for 3-6 months of basic living expenses.
Managing Property Division
Keep detailed records of all assets received in the divorce settlement.
Consider tax implications before selling or transferring property.
Work with a qualified real estate agent if selling the marital home.
Retirement Planning Updates
- Review and adjust retirement goals based on new financial situation
- Understand how pension and RRSP division affects your retirement
- Consider working with a financial advisor to create new investment strategies
- Update contribution amounts to retirement accounts
Insurance Considerations
Review and update all insurance policies:
- Health insurance – arrange new coverage if previously on spouse’s plan
- Life insurance – change beneficiaries and review coverage needs
- Home and auto insurance – update policies to reflect new living situation
- Disability insurance – ensure adequate coverage as single income earner
Tax Planning
Understand your new tax filing status and obligations.
Keep records of support payments made or received.
Consider consulting a tax professional for guidance on complex issues.
Legal Resources in Edmonton
Contact the Law Society of Alberta Referral Service: 1-800-661-1095.
Visit Alberta Courts website for forms and information: www.albertacourts.ca
Consider mediation services through Alberta Family Mediation Society: www.afms.ca
Moving Forward with Financial Confidence
Review and adjust your financial plan regularly as circumstances change.
Consider working with financial professionals who specialize in post-divorce planning.
Focus on building your credit history and maintaining good financial habits.
Set realistic financial goals that align with your new life situation.
Building New Credit History
Monitor your credit score regularly through credit reporting agencies.
Make all bill payments on time to establish positive payment history.
Consider a secured credit card if needed to rebuild credit.
Estate Planning Updates
- Create or update your will
- Review and update power of attorney documents
- Update healthcare directives
- Establish new trust arrangements if needed
Income Protection Strategies
Explore additional income sources if needed.
Consider upgrading skills or education for better employment opportunities.
Review support payment arrangements periodically.
Financial Education Resources
- Attend financial literacy workshops
- Join support groups for divorced individuals
- Use online budgeting tools and apps
Securing Your Financial Independence
Take control of your financial future by maintaining organized records and regularly reviewing your financial plan.
Build a reliable support network of financial professionals who understand your unique situation.
Stay informed about financial matters through continuous education and professional guidance.
Remember that financial recovery after divorce takes time – focus on steady progress toward your new goals.
FAQs
- What are the first financial steps I should take after finalizing my divorce in Alberta?
Update all legal documents, including wills, beneficiary designations, insurance policies, and property titles. Open new individual bank accounts, establish credit in your own name, and create a new budget based on your current income and expenses. - How is property divided in an Alberta divorce?
In Alberta, matrimonial property is generally divided equally between spouses under the Matrimonial Property Act. This includes assets acquired during marriage, while pre-marriage assets and inheritances typically remain with the original owner. - What happens to joint debts after divorce in Alberta?
Both parties remain legally responsible for joint debts regardless of the divorce agreement. It’s essential to either pay off joint debts, refinance them individually, or clearly outline responsibility for payment in the divorce settlement. - How do pension and retirement benefits get divided after divorce in Alberta?
Pension benefits accumulated during marriage are considered matrimonial property and can be divided through a Pension Division Order. CPP credits earned during marriage can be split equally between spouses. - What tax implications should I consider after divorce in Alberta?
Consider changes in tax filing status, potential capital gains tax on property transfers, tax implications of support payments, and new tax credits or benefits you may be eligible for as a single person. - How do I handle the family home after divorce in Alberta?
Options include selling and splitting proceeds, one spouse buying out the other’s share, or continuing co-ownership. The decision should consider mortgage obligations, maintenance costs, and tax implications. - What support payments am I entitled to or responsible for after divorce?
Support payments may include child support (calculated using the Federal Child Support Guidelines) and/or spousal support (determined by factors including length of marriage, income disparity, and economic disadvantage). - How can I protect my credit score during and after divorce?
Monitor joint accounts closely, remove your name from joint accounts where possible, establish credit in your own name, and ensure all payments are made on time, even for joint obligations. - What insurance policies should I review or update after divorce?
Review and update life, health, disability, and property insurance policies. Consider maintaining life insurance policies required by divorce agreements and updating beneficiary designations. - How should I adjust my investment strategy after divorce?
Reassess your risk tolerance, investment goals, and time horizon based on your new financial situation. Consider working with a financial advisor to develop an investment strategy aligned with your post-divorce needs.
