14 Mar Divorce Pitfalls
The truth is that many factors combine to lower a woman’s standard of living after divorce. Many times child support is not adequate to cover the true costs of raising a child. Many times a divorce causes loss of career growth, making it difficult for women to get back on their feet after divorce.
There have been studies that show that in the first year after divorce, the wife’s standard of living may drop almost 27 percent while the husband’s may increase by as much as 10 percent.
When you are able to do advance planning, it goes a long way. By familiarizing yourself with the financial pitfalls of divorce, you can save yourself a lot of irritation, heartbreak and hassle.
Divorce And Dwindling Cash
Expenses will go crazy when you begin the divorce process. Money previously used to support one household must now stretch to support two. If you are contemplating divorce, now is the time to begin gathering the funds you’ll need to stay afloat.
• Records: Make sure you get copies of all financial records before you begin the divorce. Try to obtain copies of all financial records before your divorce begins. Make a clear copy of all tax returns, loan applications, wills, trusts, financial statements, banking information, brokerage statements, loan documents, credit card statements, deeds to real property, car registration, insurance inventories, and insurance policies. This is highly important.
• Overlooking Assets: Don’t overlook any assets—half of everything is yours! Even if you don’t want an asset, it can be used to trade for something you do want. Inventory safe deposit boxes; track down bank and brokerage accounts; review pay stubs, retirement plans, and insurance policies.
• Tax Consequences: Should you take monthly alimony or a lump sum? Should you take the brokerage account or the retirement plan? Should you keep the house or sell it now? Who should pay the mortgage until it sells? Don’t ignore the hidden tax costs of divorce in making these decisions.
Avoid Serious Divorce Mistakes
These are just a few of the serious mistakes that can be made with a lack of planning before your divorce. Acting out of emotion has never helped make any situation better.
If you are heading for divorce, it’s always a very good idea to have a qualified and experienced family law attorney assist you. Divorce is very complicated and things can easily get confusing. Don’t find yourself in a bad situation because you didn’t consult with an attorney. Call Jeffrey M. Bloom at (805) 208-3650 for a consultation. He will assist you in your divorce while making sure you are treated honestly and fairly.