Top Five Financial Mistakes People Make During Divorce
Going through a divorce or separation can feel like trying to complete a juggling act. Shared children, financial considerations, division of assets, etc. can all be catalysts for stress, for errors, and for confusion. Protecting your financial interests is one of the most important things an individual should do during divorce; however, it is one of the tasks that most often goes wrong. How can you avoid the most common financial errors people make during the divorce process? Keep this list in mind as you navigate your Florida family law dispute:
Mistake #1: Misunderstanding Expenses
Most people try to keep a budget, but don’t exactly know where each dollar goes. A person going through a divorce or separation should take some time to write down all assets, sources of income, and expenses to ensure that all financial documents are up-to-date and accurate.
Mistake #2: Assuming that Child Custody Goes with the Home
Matching primary custody with acquisition of the family home could be a good decision to protect the continuity and stability of shared children’s lives. However, it would be a mistake to assume that to be a non-optional arrangement. Remember, it is not necessarily true that because a person easily afforded a spacious family home with the income of his or her spouse, he or she could or should maintain that level of spending on rent or a mortgage while alone.
Mistake #3: Trying to Go Item-by-Item
For many endeavors, taking things one by one is a great way to stay organized. But when it comes to getting through the divorce process, the best way to handle financial issues is all at once to ensure that the comprehensive divorce agreement is fair to both parties. Dividing assets unequally, for instance, might actually benefit both parties after shared debt has been distributed between them.
Mistake #4: Missing the Minutia
Most individuals seeking a divorce will remember to divide assets, adjust wills and estate documents, and reach agreements on issues like child support and alimony. However, it is easy to miss double-checking defined benefit pension plans to ensure eventual payments are not shared, or to forget to get a qualified domestic relations order to mandate how a 401(k) plan will be divided.
Mistake #5: Forgetting to Look Ahead
It is easy to fixate on present-day finances and lose the big picture. But an investment that is “a sure 40 percent increase per year” might not actually be a very good deal, a child support order may look great for the next year but could be financially crippling in 10 years, and nabbing the family car could end up being an expensive liability instead of a valued asset.
A divorce or separation is a complex legal process that can be fraught with pitfalls. Luckily, there is no need to attempt to navigate the process alone. To avoid making these or other errors, consider getting in touch with a divorce lawyer. At Schwartz | White, our qualified Boca Raton family law attorneys are prepared to evaluate your case and work to keep your divorce or separation mistake-free. Call 561-391-9943 today for a consultation.