During a separation, or even when a couple is contemplating a split, both individuals tend to experience higher than normal levels of stress. People may be concerned about future living arrangements, effects on children and many other aspects. Many individuals have particular concerns about the effect of the divorce on their financial well-being, now and in future. Massachusetts residents who are considering or going through a divorce are wise to be sure they are well-informed in several different areas of their financial situation in order to make smart decisions throughout the divorce process and into their future. One financial expert explains several categories to evaluate: assets, liabilities, income and expenses.
First, divorcing individuals need to assess their assets, including cash, bank accounts, stocks, bonds, etc. People also need to be aware of the tax consequences for each, especially when they are determining division of assets during the divorce process, as some assets are treated differently than others. In addition, divorcing individuals need to be sure to discuss division of defined-benefit plans, such as pensions, including details around survivor’s benefits in case of death. Real estate, which could include the marital house, rental properties, business properties and many other types, will also need to be negotiated, including how property itself will be divided, and if it is being sold, how proceeds will be divided.
Divorcing individuals also need to consider their role in any marital debts, including debt related to marital property. It is important to note that both parties still have an obligation toward any joint debt, even if, for example, one person remains in the marital home and pays the existing mortgage. Finally, many people working through the divorce process need to negotiate child support and/or spousal support and should be fully aware of the tax implications for each party, including the significant changes regarding alimony that became effective on Jan. 1, 2019.
Of all the aspects of divorce that typically cause divorcing individuals stress, for many, finances may be near the top of the list. To reduce stress levels and to ensure a fair settlement for both parties, people are wise to become financially informed. Massachusetts residents considering divorce or those who are ready to begin the process can contact an experienced family law attorney for assistance in negotiating all of the financial details, as well as all other necessary aspects of divorce.