If you are currently going through a divorce, issues related to the division and distribution of assets can be on the forefront of your mind. Make no mistake, without adequate preparation, a divorce can wreak havoc on your finances. Reviewing years of monetary data can seem overwhelming, but the first step is to create a plan and get organized. Our blog covers 7 tips for divorcing couples to help protect your financial stability and interests during and after a divorce.
Financial tips for divorcing couples include:
- Gather financial data and evidence: The accurate evaluation of all property can be a key factor in ensuring that spouses get a fair share of marital assets. This begins with gathering evidence relating to the financial health and situation of both you and your partner. This process can include collecting bank account statements, credit card applications, loan payments, and projections of future income. The earlier this process begins, the better and more accurately assets can be distributed.
- Get property evaluated: Another key part of understanding the true status of your finances is to track and appraise all of your assets. All marital assets may qualify for division and distribution under state law and understanding the value of what you and your spouse currently own can play a key role in a divorce.
- Factor in inflation: A divorce settlement must not only plan for the immediate future, but also for a spouse’s long-term stability. Divorcing couples may not realize the full impact that inflation may have on their finances. A good and long-term plan can see that the interests of your family are protected well into the future.
- Avoid letting emotions cloud financial decisions: During a divorce, emotions will run high and it may be tempting to want to hold on to, or keep your spouse from, items. While it may be true that you cannot put a value on an emotional connection, it is important to avoid choices which are not in your best interest. For example, fighting to keep a family home that is unaffordable is a common emotional response to divorce.
- Consider a non-litigated divorce: Processes such as mediation and arbitration take place outside of the courtroom and can often work to save divorcing spouses money. This is partly because the processes are usually quicker than a litigated or contested divorce and require fewer legal representatives and resources. However, spouses must be able to cooperate in order for processes such as mediation to be successful.
- Update your estate plan: One frequent mistake spouses going through a divorce can make is failing to update each document within their estate plan. Neglecting to change or remove the name of an ex-spouse on wills, powers of attorney, inheritance or insurance policies can throw a wrench into otherwise well-drafted plans.
- Hire an attorney: a knowledgeable attorney can be a key partner in planning for your financial stability after a divorce. The tax implications of a divorce alone can be overwhelming and securing the right legal advocate can make the critical difference in your divorce. Attorneys can also recommend consulting with specialists such as forensic accountants where it may be necessary.
Questions about Divorce? Call (914) 873-4410
Working through a divorce can be a tremendously complex process and most spouses will have a number of questions regarding how to best protect their financial interests. If you are currently going through a divorce and are searching for legal guidance, contact Friedman & Friedman, Attorneys at Law. Our Westchester County divorce lawyers understand the emotional, legal, and financial issues associated with divorce and can bring more than three decades of experience to your case.
Schedule an initial consultation today and learn about how divorce can affect your financial goals.