Dealing with the financial and emotional aspects of divorce can be extremely taxing. Recognizing and avoiding these common mistakes make for the smoothest transition possible as couples move into the next phase of their lives.
Finances in Divorce
If your spouse is usually the one to handle the finances, and you are not aware of the household income, debts, or assets, you could be at a disadvantage when it comes time to negotiate property division. Create a list of all marital and separate assets and debts. Make copies of tax returns, bank and credit card statements, property and investment records, and insurance records and safeguard them outside the home or with your Maryland family lawyer.
Familiarize yourself with the regular household management of money and look for red flags that your spouse may be making changes without your consent. Carefully monitor bank statements, investment accounts, and the cash value of insurance.
Taxes in Divorce
Understand the tax implications of your divorce settlement before you sign the agreement. Once tax consequences are factored in, the reality of what may have previously appeared to be an agreement in your best interest could very well turn out to put you at a financial disadvantage. Protect your financial future by consulting with an experienced Baltimore County divorce lawyer who has the resources to negotiate a financially secure settlement.
Future Expenses in Divorce
When considering financial issues that will affect you in far into the future such as retirement savings or the cost of your child’s college education, be sure to factor in inflation. A good benchmark that takes into account inflation is the rule of 72. For example, at a 3% inflation rate, prices will double in 24 years (72/3=24.) Knowing the true cost of future expenses gives you the information needed to make informed, financially sound decisions during divorce negotiations.
Estate Planning in Divorce
Be sure to change the beneficiaries on your life insurance policy, IRAs or will. In the event of your death, you want to be certain that your assets to go to those you intend, whether they are your children, a new partner, or favorite charity. This is crucial if you do not want your ex-spouse to receive these assets.
Emotions Impede Divorce Decisions
The emotions you go through as you transition through your divorce can often feel similar to a roller coaster ride. One day you may feel hopeful and optimistic, and the next day you may feel intense anger or extreme sadness. Making rash or impulsive decisions based on emotion often leads to mistakes that will forever impact your future. If you are having trouble coping with the ups and downs of the divorce process, talking with a counselor can help you to settle your mind so you can make decisions that are in your best interest.
Let Go of the Past to Move Forward
Moving on and thinking about the future can be difficult when the relationship you thought would last forever just ended. Dwelling on what once was, or what could have been will slow your progress in moving forward. This holds true for material possessions as well. Emotional attachments to marital possessions like the home or a piece of art purchased during your marriage can lead to fierce and expensive battles. Your main focus at this time should be on maximizing your finances in order to build a secure and stable future for yourself and your children.
Punishing your Spouse is a Bad Decision
Trying to hurt or punish your spouse leads to bad decisions that result in a longer process and a more costly divorce. If there are children involved, the hurt you direct at your ex-spouse will likely impact the children the most, causing stress and emotional scarring that can affect them long after you have moved on. Treat your divorce as a business arrangement and focus your energy on building a better future for yourself and your children.
Baltimore County Divorce Lawyers at Huesman, Jones & Miles, LLC Prevent Couples from making Mistakes in the Divorce Process
Hunt Valley divorce lawyers at Huesman, Jones & Miles, LLC have helped countless individuals sort out the complexities of their divorce arrangements. Our firm handles all aspects of family law including property division, alimony, child support, child custody, parenting plans, and estate planning. We serve clients in Baltimore County, Carroll County, Harford County and Howard County as well as in the communities of Towson, Bel Air, Columbia, Westminster and Essex. Call today to schedule your free consultation at 443-589-0150 or submit an online contact form.
