Divorce and financial complications can seem to be a tricky proposition
While the two concepts often seem similar, they are actually very different beasts. The divorce process itself can be expensive and complicated. Divorce mediation and pre-filing papers require financing, which may not always be available to the divorcing couple.
Most experts would agree that it is important to consider every aspect of the financial situation before determining how to proceed. This is where a divorce financial planning professional comes into play. Exploring asset protection strategies with a trained family law attorney is an ideal way to avoid future financial problems and possible litigation. In addition, evolving new concepts of asset protection have rendered long-established legal guidelines inadequate in many cases.
Many couples choose to work out their differences without the help of an attorney
Because they feel that they can make financial decisions in a straightforward manner. However, this is a mistake that can have long-term negative effects. By seeking counsel from a skilled family law attorney, individuals can ensure that they create an estate plan that protects their future and assets for their children as well as provide tax advantages for their spouse.
One of the first steps of the divorce financial planning process is developing an inventory of each spouse’s assets and liabilities. This inventory should be completed on an individual basis, taking into consideration the division of property between the spouses and the length of the marriage. Typically, the assets that a person wishes to protect will not change during a divorce, while the ones that do may be subjected to a different set of divorce laws than what was once in place. A good inventory is also useful in setting up a trust or other nominee entity to ensure that the assets are protected throughout the divorce process. This list can be developed with the assistance of a divorce lawyer and can then be made part of your Will.
Another asset that most people forget to take into account after filing for divorce is alimony
During the time of marriage, the husband and wife generally share equally in the care of their children, so alimony is usually awarded at the time of the marriage. Once a couple begins to live together, they may begin to divide up the assets and sharing of responsibilities differently. It is best to put together a brief description of the roles that you wish to play as a couple and then include all assets that are jointly owned. Your spouse will have an easier time understanding where you stand financially if you include this information in the Will.
Alimony is intended to keep your spouse reasonably well off while you continue to earn your standard of living. Some states still allow it to be awarded, but it is not a binding agreement. Once the marriage has ended, it is no longer relevant and is not a part of any current marital property distribution agreement. Each state has its own laws on alimony and other divorce proceedings. Seek guidance from an attorney who has experience in these areas. Your attorney can help you determine what you can do with your marital assets once the divorce is final.