Deciding to end a marriage in California or elsewhere around the country can have a significant impact on someone’s emotions. However, many fail to take into account how a divorce will affect their finances as well. Financial experts recommend addressing several issues when going through a divorce to avoid making potentially expensive mistakes.
Those who will be living on their own should create a budget with income, assets and expenses listed as they will be after a divorce. This will allow someone to plan finances appropriately to pay bills and save for the future. Addressing both current and future financial situations can be helpful in settlement negotiations.
A financial plan should also include anything a person hopes to do some day if it involves money. For example, someone may hope to attend college and consideration of how to pay for tuition should be considered. Future health care expenses and retirement plans must also be addressed. Any pension funds, IRAs or other retirement accounts have specific regulations associated with them and would have an impact on a personal financial plan.
If someone’s divorce settlement will include real estate, he or she needs to have a complete understanding of the expenses associated with it. Taxes could be a significant burden to a newly divorced person. If a couple have children together, it may be advantageous to create a trust to protect assets and ensure that the funds are managed appropriately. Someone may be expecting to receive child support payments. It would be wise to have emergency funds in place in the event the payments are not fully paid or are not on time.
Developing a strong financial plan is critical in protecting someone’s interests in a California divorce. An experienced divorce lawyer can assist clients in creating a plan that specifically meets their needs. A knowledgeable attorney will work toward achieving the best possible outcome in divorce proceedings.
Source: mvtimes.com, “Finance 101: Divorce?“, John Kageleiry, Aug. 21, 2017