The majority of parents who come through our office are concerned with findin
10 Financial Mistakes to Avoid in Divorce
The two things that people worry about most in divorce are their money and their kids. Unfortunately, worrying about money doesn’t prevent those same people from making enormous financial mistakes during a divorce.
Here is the list of the top financial mistakes that a person can make in a divorce. If you know them ahead of time, you can (hopefully) avoid making them yourself.
1. Not taking the time to do an accurate post-divorce budget BEFORE you settle!
Doing a budget is a hassle. Roughly two-thirds of Americans don’t make (let alone follow!) a budget. But trying to settle your divorce case without making a budget is like trying to drive from Texas to New York without a map. You can do it, but you are probably going to get lost a lot along the way.
2. Not insisting on getting all of your (and your spouse’s) financial documents.
No one likes to spend days digging up and organizing old financial documents. But nothing causes people to make more divorce money mistakes than not getting the financial documents that show whether their budget and balance sheet are accurate reports of their financial situation, or simply creative fiction.
3. Not getting assets valued.
Getting your house appraised or your spouse’s pension valued when you are getting a divorce is a hassle. It takes time and costs money. But the only way to really know what your house is worth is to sell it, or get it appraised. The only way to know what a pension is worth is to get it valued. If you choose not to do either, that’s fine. Just know that without having accurate asset values, you really have no idea how much either you or your spouse is getting in your divorce settlement.
4. Not looking at (and understanding!) all of your financial documents.
It is not enough to get the financial documents that show the state of your family’s finances. You actually have to read them and understand them. If going over numbers makes your head spin and your eyes glaze over, all I can say is: You’re going to have to suck it up and learn. Or risk getting screwed. It’s up to you.
5. Not understanding how taxes will affect your support and settlement.
There is no way you can know how much your divorce settlement is really worth without understanding how taxes will affect that settlement. Taxes affect the value of the property you are receiving, and the amount of support you will actually receive or pay. Unless you want to be surprised with an enormous tax bill after your divorce, you would be wise to make sure you know the tax implications of your settlement before you get divorced.
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We would recommend that couples should contact us for advice at the Law Office of Alice Pare at 301-515-1190 or visit our website at: https://www.alicelaw.com
Do not at any time take the risky move of going at it alone. We have a wide choice when it comes to going it alone but with the professional advice you will need.