Couples planning to divorce need even more careful budgeting than during the time they were married, especially for long-term married couples. Post-divorce financial struggles can be a major concern, making it crucial to plan ahead. It’s an emotional time when life-changing decisions are made. The wrong decision can leave one or both parties with considerable financial problems after the divorce is final and they’ve moved forward separately.
In past years, it was considered a “win” for a woman to get the marital home in a divorce. But it’s typically a liability rather than an asset, especially if it’s a larger house. This can leave a woman in problematic financial circumstances later. Unless the woman has sufficient resources for mortgage payments, insurance, maintenance, upkeep, taxes, and other costs of home ownership, keeping the home can become a burden. Generally, the home should be sold so that she can invest in pensions and other types of retirement that can accrue. Both parties can rent short-term or long-term, and later purchase an affordable home post-divorce.
Strong financial planning throughout the different stages of the divorce process is essential to minimizing financial risks, ensuring that the division of assets is fair and that both parties can build a secure post-divorce financial future.
Divorce Financial Planning
When couples begin untying the knot, they must make multiple decisions about their future. Many couples have children to consider in their futures. Whichever parent has primary custody must be sure not to be short-changed in the divorce so that they can adequately provide for the children. This is where financial planning comes in.
Divorce financial planning is a specialized approach that addresses the financial aspects and goals of individuals before, during, and after a divorce. It involves assessing assets, creating budgets, managing financial risks, facilitating asset division, and examining potential tax implications.
A divorce financial advisor, often holding a Certified Divorce Financial Analyst (CDFA) designation, helps develop a financial plan during and after a divorce. This advisor can tailor traditional financial advisory services to the specific needs of divorcing clients, including:
- Asset identification and valuation: Determining the value of assets such as retirement accounts, real estate properties, business investments, and other tangible assets.
- Liability assessment: Identifying and managing debts and financial obligations.
- Tax implications: Analyzing the tax consequences of asset division and financial decisions made during the divorce process.
- Future financial planning: Creating budgets, setting retirement goals, and developing strategies for financial stability post-divorce. A divorce financial advisor is an important part of a person’s overall team.
- Support calculations: Assisting with alimony and child support considerations.
- Expert testimony: Providing litigation support and appearing as an expert witness if the case goes to court or in mediation proceedings.
Divorce financial planning is particularly beneficial for couples with significant assets, complex financial situations, or when one spouse is less informed about household finances. It helps ensure a fair settlement, minimize financial risks, and secure a stable financial future for both parties after the divorce.
Fort Worth and Tarrant County Divorce Attorney
Wendy L. Hart has been helping people in the Fort Worth area with all their family law issues since 2001. She represents both men and women in all aspects of divorce, including spousal and child support matters. Post-divorce financial struggles can be challenging, and having experienced legal guidance can make a difference in securing your financial future.
When you’re ready, contact us via our online contact form, or call us at (817) 842-2336. Divorce is a difficult and emotional process, so don’t try to handle it on your own. Contact The Law Office of Wendy L. Hart and get the help you need.
