If you’re getting divorced—or even thinking about it—you probably realize that dividing the finances will be one of the biggest burdens you face. Many couples pool their money during marriage to achieve a higher standard of living than they can enjoy on their own. When you separate, this can be a rude awakening, especially if one of you acted as a stay-at-home parent or spouse.
To get a fair judgment, you’ll need to avoid making certain financial mistakes. The best way to do so is to contact a family law attorney in Lubbock, TX—but you can read on to learn more about the most common financial mistakes divorcing people can make:
- Not having a clear budget: Most of us understand how much money we make per month—but do you know exactly where that money is going? As long as we can pay the bills, many people fail to figure out precisely what they spend and where. Before you start the divorce proceedings, start evaluating the last few months of income versus expenses. This will help you create a realistic monthly budget—and don’t forget to factor in inflation in the coming years.
- Conflating “equal” with “fair”: Some assets are bound to appreciate, while others depreciate over time. That means that a monetarily equal settlement does not necessarily mean a fair one. Make sure that when you’re dividing assets, you give thought to appreciation or depreciation before you sign on the dotted line.
- Assuming the main custodial parent should keep the home: You and your children are probably quite attached to the home where they grew up—but does it make financial sense to keep it? When dividing your assets and figuring out child support, make sure that you can comfortably afford to keep the home on your own. Otherwise, it may make more sense to sell the home and divide the proceeds.
- Failing to get insurance policies: Did you know that you can request your spouse get disability and life insurance policies to ensure they can pay child support, even if disaster strikes? While this won’t help if they choose to stop paying while alive and able-bodied, it can help if the worst happens.
- Not understanding which debts you’re liable for paying: You need to understand the breadth of your unsecured marital debt, and what you’re responsible for paying. An attorney can help you determine this liability.
- Evaluating your finances on a piece-by-piece basis: Some couples decide to evaluate their financial situation bit by bit, rather than looking at it as a whole. If you look at everything separately, you may miss capital gains and tax implications that could hurt you both.
- Being unrealistic about investments: Some ex-spouses will try to convince the other that certain investments will definitely appreciate at a specific rate over time, so they should settle for less elsewhere. Do not take their word for it.
If you’re in need of a divorce lawyer in Lubbock, TX, call the Law Office of Rob Biggers today.
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