What Are Some Common Financial Mistakes To Avoid In A Divorce?
Divorce can be a complicated process, and you really need to do everything that you can to make sure that you are getting a fair agreement. Many people make financial mistakes during their divorce and such errors can be difficult to bounce back from. That’s why we recommend working with our Morristown property distribution attorneys to negotiate a divorce agreement that sidesteps some of the most common financial pitfalls.
Why Do People Make Financial Mistakes During a Divorce?
There are a few reasons why people often end up making financial mistakes during the divorce process. One big problem is that people can sometimes be more emotional than rational during these negotiations. If you are mad at your spouse and mostly just concerned with “getting one over” on them, it’s possible to make some unwise decisions.
People also make mistakes when they rush this process. We understand that a divorce is stressful and that it’s tempting to just do everything that you can to get through it as quickly as possible. You have to think about the future and the potential consequences of the financial decisions you make though.
Another common issue is that some couples won’t explore alternatives to litigation. Collaborative divorce, mediation, and arbitration are different ways to solve conflicts, and depending on your situation and willingness to negotiate one of these options might be more effective than going to court.
What Are Some of the Most Common Financial Mistakes?
Now let’s look at some of the big financial mistakes that people tend to make when negotiating a divorce agreement. Common pitfalls include:
- Getting stuck with more of the marital debt
- Not asking for a fair share of retirement assets
- Failing to consider the tax implications of your agreement
- Not conducting an investigation to look for hidden assets
- Keeping the family home without considering the costs
- Misvaluing marital assets, especially business-related assets
- Not properly estimating post-divorce living expenses
What Should I Do After a Divorce?
There are also a few steps that you can take to protect your finances after you finalize your divorce. You should make it a priority to update any legal documents or policies with beneficiaries. This can include things like:
- Estate plans
- Banking or retirement accounts with beneficiaries
- Life insurance policies
If your spouse was your beneficiary on anything like this, you probably want to make some changes. You don’t want them to inherit your money after you’re gone.
Meet With Our Legal Team
If you have questions about the divorce process or you’re ready to file, contact Lazor Rantas, PC. We can schedule a consultation and tell you more about what our attorneys can do to help.
