Divorce is typically an emotional affair, and you may be one of those who is so overwhelmed by your emotions that you struggle to focus on the aspects that will determine your post-divorce financial stability. Divorces nationwide, including here in Arizona, can come with many financial challenges, but, with careful navigation, you can dodge many financial obstacles and move on to a new chapter of your life.
Here are five points to ponder:
1. Itemize assets
If your spouse handled the family finances during the marriage, you might have your work cut out for you in gathering information about investment accounts and the assets and savings they hold. Before even considering how to divide the property, you may want to make a thorough effort to list and determine all possible marital assets.
2. Find hidden assets
In many highly contentious divorces, one partner sometimes uses devious ways to conceal assets. Make sure you are not that person because it is illegal and can lead to perjury and fraud charges along with contempt of court. If you suspect that your spouse is trying to hide assets to lower his or her contribution to the divorce settlement, you can get help to uncover those assets to ensure you get your fair share.
3. Determine whether or not to let go of the family home
Although it may cause additional trauma for the kids if you let go of the home with which they are familiar, your post-divorce finances may not cover the costs typically associated with property maintenance, taxes and more. Before choosing to keep the home, make sure you will be able to get a mortgage to transfer the property onto your name, and afford the payments. Emotion can take over and make the decision to downsize tough, but holding onto the home could be detrimental.
4. Draft a post-divorce budget
Remember that previously shared expenses will now be your responsibility. Accommodation costs — in your own home or a rental — will be for your account only, and so will utility bills, groceries, and more. Do not forget to list clothes and discretionary entertainment items such as occasional meals out or movies. Preparing a budget ahead of time could save you a lot of headaches both during and after your divorce settlement.
5. Learn about the tax implications
Being uninformed about the tax consequences of the assets you receive can cause unpleasant surprises. You may not realize that receiving an investment in the asset division process may bring a significant tax hit, and paying child support is tax deductible while receiving spousal report is taxable.
Every one of the above steps may seem complicated and beyond your capabilities during this difficult time. However, there is no reason for you to do this without help. Just like building a team of family and friends to provide moral support, you can build a team to assist you with legal guidance and advice. An experienced Arizona divorce attorney can arrange for skilled advisors to assist with matters related to asset valuation, investments, taxes, child-related issues and more to help you enter your new life without financial insecurities.