Top Money Mistakes To Avoid In Your Divorce!
In any divorce, each party has to be smart and also realistic in terms of what the new reality of their life will be post-separation and post-divorce. The money that was spent on a life together is now being split to maintain 2 separate lifestyles. Before you sign your marital settlement agreement, consider these potential mistakes that you will want to avoid:
- Settling for less in the division of property and assets than you are entitled to in order to obtain more child custody or visitation.
These are 2 separate issues and one should not be contingent on the other.
- Underestimating your monthly budget and needs.
You must be realistic in what you will need to not only financially survive but live a semblance of what your marital standard of living was.
- Trusting your attorney to know or determine what is financially best for you.
Although your attorney can offer you sound legal advice and information, you must also be knowledgeable of your finances and take responsibility for your financial future.
- Making money decisions one-at-a-time.
It is best in divorce proceedings to consider the big picture of what the impact of child support, spousal support and division of property will be as they relate to taxes, inflation, and related issues. You should strive to work out a “global” settlement on all financial issues together whenever possible.
- Failing to prepare for future problems.
Although there is generally no legal requirement for life or disability insurance to be required as a guarantee on child and spousal support in the event of death or inability to work. However, given that term life insurance is generally very affordable nowadays, an agreement that the payor of support will maintain sufficient life insurance to act as a guarantee on the support is reasonable and smart. Generally, the party paying support wants to make sure that their children (or hopefully spouse too) are protected in such an event. In the alternative, such a life insurance policy can be maintained at the expense of the supported party (payee) for the same reasons.
- Failing to work out how debts and liabilities will be paid off.
In most divorces, it is best for the parties to try to pay off all debts of the marriage from the assets in the divorce so that both parties can start out with a clean slate. Otherwise, failing to do so can come back to haunt you. If you have joint debt with your spouse, most creditors are going to come after both of you if such debt is not paid and could care less about what your divorce judgment says.
- Not determining how to handle post-divorce financial matters.
The division of pension and other retirement benefits as well as transfer of accounts and obtaining health insurance after you no longer qualify to be on your spouse’s coverage are several issues that need to be addressed in your divorce judgment, so that there is no doubt about how they will be handled. Avoiding vagueness and ambiguity regarding such issues will save you a lot of headache after your divorce is completed.
For further information or to schedule a consultation with Orange County divorce attorney Gerald Maggio of The Maggio Law Firm, please call (949) 553-0304 or visit www.maggiolawfirm.com. The Maggio Law Firm is an experienced divorce and family law firm serving the Orange County and Riverside areas and neighboring counties, serving clients with legal issues including divorce, legal separation, prenuptial agreements, divorce mediation, and other family law issues.