There are many things that should be taken into account if a couple is considering divorce. A couple should think about all the financial aspects and implications of such an action. The couple considering divorce should consult with an accountant or financial planner to better understand the potential cost and to better understand the assets held by the couple and the best way to proceed. Of course, each would need a divorce lawyer as well but with a clear understanding of the estate held by the couple would save a lot of hardship and grief in the future and would make the transition a lot smoother for both parties involved.
Welfare for Children
The first thing a couple must consider is the welfare of any children born to or adopted by the couple. The separation of the family is going to be hard on them and anything a couple can do to ease the loss and transition for any children involved should be the first order of priority. A couple should workout the type of child custody the parents will have over the child, whether it will be joint or sole or who will have legal custody. This should be done in a way that spares the child form as much heartache and sorrow as possible.
Making a New Budget
The second thing to consider is the amount of available funds for each and how to make two households work with same amount of money used to run one before the divorce. A solution to this may be to liquidate assets or property. One or both of the parties may need to borrow money in order to make up for loss of revenue. A new budget will have to be drawn to consider the changes necessary to accommodate for basic changes in spending and lifestyle.
Dealing with Debt
Next the couple should consider the debt held by the couple. Depending on where the couple lives, different laws will apply but for the most part expect to split the debt equally between the parties or according to the relative earnings of each. Of course there are other factors that can lean a debt more to one side than the other like if a certain debt is substantially unbalanced for the purpose of running a business that will fall to one of the spouses or if the debt incurred was so the one of the parties could finish a career, etc.
The division of assets is one of the most tedious and a troublesome aspect of a divorce and none is more contentious than who retains ownership of the primary residence owned by the couple. For many, the solution is selling the property and splitting any money made in the transaction. In assigning the primary residence the couple should be aware when considering the value of the home that there is a hefty tax exemption on the sale of a primary residence.
Dividing Retirement Benefits
Pensions, retirement accounts, and/or Social Security benefits can also be affected by divorce. Normally, the spouse of a person receiving any pension or retirement account that is earned while the couple is married is entitled to a portion of those benefits. That can affect the amount of retirement a person is entitled to when they retire. Likewise if the couple has been married for ten years or more, a spouse can qualify for Social Security benefits under the ex-spouses' earning history. But divorce can also work in the other direction, if a couple has been married less than ten years and one spouse is receiving Social Security benefits under the ex-spouses' earning history, that spouse will lose the right to collect those benefits if they divorce.
Other things to consider before considering divorce include:
- Child support
- Alimony
- Health-insurance coverage
- Legal fees
A competent and experienced divorce lawyer can help make this difficult and strenuous transition easier for both you and your family. Contact a divorce lawyer in your area today if you are considering divorce.
