Five Financial Mistakes To Avoid In Divorce
Working through a divorce is an emotional and logistical whirlwind. In many cases, the spouses are just hoping to survive the process and make it to the end with a place to live and visitation rights with their children. As much as the process might seem to take on a life of its own, there are a number of things that divorcing spouses should remain aware of in order to ensure a sound financial future after the divorce.
At The Rose Law Firm, LLC, our attorneys dedicate their entire practice to helping clients navigate complex divorce issues in a way that provides them and their children with the best possible future. The following are five common financial mistakes to avoid in divorce and the division of marital assets.
1. Taking on too many expenses
It’s important that you are honest with yourself about the amount of money you will have to spend as a single person. Create an honest budget and be realistic with what you can afford. If you and your spouse bought a brand-new SUV six months ago, and you will not be able to afford the payments on your own, don’t ask for it in the division.
2. Ignoring the potential tax burdens that come with certain marital assets
Similar to No. 1 above, it is important that you remember the costs associated with owning a particular asset. If you get the house, for example, you also get the mortgage and tax payments. Be sure that you have a complete understanding of the financial obligations that come with ownership of a particular asset.
3. Mishandling the division of retirement accounts
Getting a share of your spouse’s retirement accounts is difficult enough in Alabama. Don’t let the share you have won be diminished by mistakes in the division of the accounts. Any Employee Retirement Income Security Act (ERISA) compliant retirement account can be divided using a Qualified Domestic Relations Order (QDRO).
4. Forgetting about marital debts
When many people think about property division in Alabama, they only think about the division of the marital assets. Many forget that the marital debts must also be divided in a fair and equitable manner. Marital debts should be factored into any discussion about your financial future after a divorce.
5. Being short-sighted
Remember, the property division decisions you make today have the potential to impact you for the rest of your life. Don’t give away your long-term future for a quick win today. Don’t let revenge, hurt feelings or sentimentality get in the way of a good strategy for securing a favorable outcome that will best provide for you and your children after the divorce.
Talk To A Lawyer About Your Property Division Needs
We invite you to contact our Birmingham office to discuss your property division concerns in more detail. We offer a free, in-person consultation where you can get honest answers to your questions and learn more about how we can help you. You can reach us by phone at 205-208-7560 or via email. A representative of The Rose Law Firm is available at any time, day or night, to help you schedule an appointment.