Thinking clearly through a divorce process can be an endurance test for many New Yorkers. Divorcing spouses often allow the financial impact of a divorce settlement to become secondary to emotions at a time when practicality needs to be a priority. Property division, long-term financial plans, child support and spousal maintenance are issues that can easily overwhelm people who are facing the end of a marriage.
However, it is important for those going through a divorce to think clearly and logically. Emotional decisions are not always the best financial decisions. Taking count of a couple's assets and liabilities is the first order of business.
Big decisions, like which spouse, if either, retains a marital property, have to transcend sentimental attachment and include a realistic picture of the responsibilities that go with them. Mortgage payments, upkeep and taxes must be affordable for a marital property to have significant worth beyond sentimental value.
A deeper understanding of a couple's financial standing is also necessary. Divorce brings division of unseen assets like the future value of pension plans, insurances and investments. It also requires defining current and long-term expenses for children, such as day care, car purchases and college educations.
Individual bank accounts and credit cards can be established before a divorce is finalized. New beneficiaries can be designated in advance for insurance, pensions, wills, trusts and retirement plans to help ensure there are no obstacles down the road.
Each of these aspects speaks to the importance of finances in divorce. However, there is no question that a divorce is an emotional time for both parties, so speaking with an experienced family law attorney may be helpful in making sure you've considered everything as you move toward a new life.
Source: The Huffington Post, "Facing a divorce? Protect your finances," Suzanna de Baca, July 27, 2011