Mistakes to Avoid during Divorce and Finances Settlement

The decisions that spouses make during their divorce settlement can affect them for years and possibly even for the rest of their lives.  This is why it is important to consider the effects of divorce and finances during a South Florida divorce.  Some divorce and finances mistakes to avoid in South Florida include:

Not Uncovering Hidden Assets

During the divorce, it is critical that all assets and debts be identified.  The divorce order can only make instructions regarding those assets and debts that the court knows about.  Unfortunately, some spouses try to hide money that is subject to division.  Assets may be uncovered by a thorough review of the couple’s tax return, business tax returns, bank statements, brokerage statements and financial records.  A professional who has over 30 years of banking and finance industry expertise like Deborah may be able to recommend other places to uncover funds, including accounts listed in the children’s names.

Not Budgeting Post-Divorce

One common mistake that people make with their finances during divorce is to consider a budget based on their post-divorce situation.  A parent may remain in the family home with the children, not considering the financial impact of this choice.  Maintaining the home may be more expensive than the parent realized with a lack of liquid assets to support it.  During settlement mediation, parties should carefully review their liquid assets and income and compare this information with their projected expenses to determine if the proposed settlement will provide adequate resources to support the projected post-divorce budget.

Not Considering Tax Implications

When deliberating on property division issues, parties may only think about the current value of assets without taking into full consideration tax implications.  Capital gains can mean associated taxes with these assets.  Taking funds out of a retirement account can also have significant tax implications.