Bearing financial implications in mind during a divorce
Divorce in Illinois is something that happens quite frequently. While it is unfortunate for a couple to come to the end of a marriage, there are benefits in that the contentious nature of a failing marriage can stop once the difficult decision is made to move on. That said, a divorce can lead to significant financial problems for both parties. It does not have to be a high asset divorce for this to be the case. When a couple is parting ways, there are certain things they should remember to avoid financial disasters during and after the process.
When planning for a divorce, it is important to inventory the marital assets. While it is a best case scenario for the parties to have a firm grasp on the assets that are separate and those that are marital, it does not always happen. As a divorce becomes inevitable, going through all accounts and properties can avoid rancor. It is unwise to make significant changes to these items by selling them or moving assets to different accounts. With a divorce, it might be necessary for one or both parties to consider career changes. Preparing for this by starting to job search early or planning in advance is a wise decision.
Although it might be easier for the divorcing couple to stop living together, this can be a major cost and inconvenience in looking for a new place to live. Unless there is a safety issue, it might be preferable for the couple to agree to disagree in their personal lives, but continue living together as a financial accommodation until the divorce is complete.
Also, with certain items of property, there might be a sentimental aspect toward keeping them. This can lead to disputes. The family home or other items like jewelry can fall into this category. Keeping a clear head and being evenhanded about such during property division may lead to a fair outcome.
Taxes can be negatively affected by a divorce in ways that the participants did not anticipate and be very costly. For example, splitting a retirement account could have unintended and expensive consequences for both. Being completely aware of how such tax issues are dealt with is important.
Ultimately, it is important to understand what to expect financially during a divorce, whether the divorce is amicable, moderately difficult or a nonstop series of disagreements. Moving on financially as well as personally can have challenges, but these challenges can be overcome. Having legal help is one of the most important decisions that can be made.
Source: U.S. News and World Report, “10 Ways to Prevent a Divorce From Ruining Your Finances,” Maryalene LaPonsie, Sept. 29, 2016