Ways to Safeguard Your Assets in a Divorce
In a marriage, couples typically share the economic burden together. Divorces often have disastrous effects on divorcees’ bank accounts and financial outlooks, because of the change it brings to the wealth structures. Although divorces are never easy, taking the right steps to safeguard your assets can ease some of the stress.
Avoiding Financial Mistakes
There are various financial errors people commonly make in divorces. Below are some ways to prevent any unnecessary mistakes:
- Try not to spend money on any unneeded expensive purchases. Although you may think that if you spend the money your spouse will not get that part of it, spouses can assert that you unjustly took the money.
- If you pull money out of investments, such as your IRA or 401(k), you could face considerable penalties and taxes.
- You should consider how alimony will influence your taxes after the divorce. Keep in mind that with the Trump tax plan, spousal support payments do not allow for tax breaks.
- Do not quit your job just to try and escape alimony, because as soon as you begin working again you will have to pay it.
- Whoever decides to keep the house will most likely be required to buy out their spouse. If you cannot pay the mortgage, it might be better to sell it. If you want the house, keep in mind that you will only have one income. Also, you may need to pay child support or alimony.
- Try not to incur excessive debt, because if the judge believes that you recklessly spent the money, you will be obligated to repay it after the divorce.
- Do not make any knowingly false statements regarding your assets, otherwise your ex may bring you back to court seeking more assets.
Adapting Financially to being Divorced
After the divorce is finalized, conforming to your new lifestyle may seem challenging, but it is important to adapt financially. Make certain that you have received all of the assets awarded to you in the divorce. Also, you should create a detailed financial plan that considers your updated financial status. This includes creating a budget to assist you with money flow.
Post-divorce financial plans should take into account emergency funds in case of an unforeseeable circumstance arises. Additionally, do not forget to save money for retirement.
Consider Your Estate Plan
Divorces often greatly impact estate plans. In case your ex was empowered by a power of attorney or health care directive, to act for you or voice your health care preferences if you become incapacitated, you should speak with an attorney to modify the same.
Additionally, you should carefully review your will and trust. Review and revise any beneficiary designations that have changed as a result of your divorce. Check all of your bank accounts, retirement plans and insurance policies, because you are required to submit a change of beneficiary form at each institution.
Seek an Experienced Divorce Attorney
A skilled Orlando divorce attorney can advise you on avoiding any potential financial missteps. The Law Offices of Steve W. Marsee will assist you in adapting financially after your divorce.
Our mission is to get you back on your feet as soon as possible. In order to accomplish this, it is crucial to consider your financial future. Make sure you choose a qualified attorney to represent your interests. Call us today at 407-521-7171 or contact us online, to discuss ways to protect your assets during a divorce.