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Financial issues you may not have considered in divorce

| Dec 14, 2020 | Divorce |

When preparing for a divorce, some issues to resolve are more evident than most. If you have children, then determining child custody and child support payments will be obvious. One of you may also need to make alimony payments to the other. If you have a house, you will need to work out who keeps that and how you divide other assets. Yet there are some other essential things which you might not have considered.

Debts need to shared

You need to divide your debts, as well as your assets. Some couples choose to sell the family home to relieve themselves of this joint debt. You may be able to split other debts, such as those from joint credit cards, by taking out individual personal loans. The important thing is to separate yourself financially from the other person once your marriage ends.

Retirement plans and pensions need dividing

You can use a qualified domestic relations order (QDRO) to divide pension plans or 401Ks. If you have an Individual Retirement Account (IRA), an experienced divorce attorney can help you work out the best way to manage this. There is potential to pay unnecessary tax if you do not correctly address these issues.

Running a household alone costs more

If you previously had two incomes, you will need to adjust your budget. From now on, you will likely be paying for everything yourself. Calculating your future income and needs is essential. It allows you to enter divorce proceedings with realistic targets to aim for.

Don’t forget the cost of divorce proceedings

Divorce costs can soon become expensive if you are fighting over every little issue. Using divorce mediation allows you to reduce the cost and time needed to resolve your divorce.