Avoid Making These Five Financial Mistakes During Divorce

Our divorce attorneys know that going through a divorce (whether contested or uncontested) is never enjoyable – but don’t be left to regret how the process unfolded. Once you and your spouse have decided to go through with separation, hiring adequate divorce attorneys for each party is the best way to handle the situation properly. Divorce and family lawyers are experts at making the transition as smooth as possible and ensuring fair representation for both parties. There are futures at stake, and many pitfalls to be aware of. We’ve compiled a short post detailing how to avoid making common financial mistakes during divorce.

Hanging onto your house and property
During a typical divorce case, many couples try to keep hold of their house and property no matter what. This is not always the best option for either party, as the house will cost money down the road. There are mortgages, property taxes, property maintenance and unexpected maintenance costs that can occur and will have to be paid for. The house and property should be awarded to the party that can best afford it and compensation be paid out to the other. Keeping the family home should not be the primary negotiating point.

Not divorcing yourself financially
Getting a clean separation, especially financially, is paramount to any successful divorce case in Alabama. Not only will each party know where they stand financially but also there will be no dependence left. There is nothing worse than continuing to share bank accounts or credit cards and have one partner begin to take on debt. All sorts of arguments and frustration can occur from continued financial partnership – and after all, what’s the point if you’re no longer married?

Continuing with mutual financial arrangements
Both parties are held responsible to the court ordered divorce agreement, excluding creditors. If one party is obligated by law to make a mortgage payment but doesn’t – creditors can sue both parties listed on the agreement no matter what the divorce agreement states. This is why a clean break is the best route.

Not adapting your estate plan
A divorce has far reaching impacts and will often affect estate planning significantly. It is wise to have your wills and trusts adjusted by an experienced elder law attorney soon after completing a divorce so that your money does not end up going to the wrong beneficiary.

Get your alimony and child support payments in order
In the State of Alabama, alimony payments are taxed differently from child support payments. Child support payments are not taxable to the recipient while alimony payments most certainly are. It is also wise to know how long payments will be received, as child support payments cease when the child turns 18 and alimony payments end if the recipient gets remarried.

Hiring an experienced divorce attorney to help you deal with all the responsibilities and keep track of them as you go through the process is the best thing you can do. The situation is stressful enough and it is often difficult to think straight and keep an unbiased scope of the proceedings. Your attorney will ensure that your best interests are fully represented and that you can worry about putting yourself back together. To schedule a phone or office consultation with a divorce lawyer from our team – call (256) 539-4464 or completing a case evaluation form online.