You may be someone who enjoys working hard but who is also looking forward to the day when you can retire. You likely have trips you want to take, sights you want to see and a number of other activities to which you look forward. Of course, you also know that having the retirement funds to cover these activities is vital.
You may have meticulously saved for retirement, and as you did so, you likely had your spouse in mind and his or her role in your retirement. However, you are now going through a divorce, and your well-built retirement security could face risks of taking hard hits as a result of the financial impacts of ending your marriage.
Though divorce may be the best option for your situation, you likely do not look forward to the negative financial effects it will have. Fortunately, by recognizing the probable hits your finances will take, you may have a chance to better prepare for them. Therefore, you may wish to consider the following factors:
- Dealing with real estate transaction costs of selling the family home at a less-than-opportune time
- Having a hard time saving as much as you once did due to covering expenses on a single income
- Dividing your retirement funds and other assets with your ex-spouse
- Handling legal fees and court costs
- Having your available credit reduced
- Facing possible tax increases
These and other outcomes of divorce could greatly influence your future financial security.
Protecting your retirement
Though your ex may be entitled to a portion of your retirement funds and you entitled to a portion of his or hers, you may have the chance to use these funds as a negotiation tool. Your ex-spouse may not want to give up retirement funds, and you likely do not either. Therefore, you may want to consider offering other assets in exchange for keeping the full worth of your retirement accounts.
You may also be able to find ways to reduce the expenses of divorce, such as by settling outside of court, which could help offset future financial instability.
Finding your best options
Because divorce is complicated and property division is often contentious, you will undoubtedly want to find the best strategies for protecting your retirement funds and other desired assets. In order to do so, you may find it helpful to consult with your legal counsel regarding your legal options and how Arizona state laws may affect your case.