Avoiding financial disaster in divorce
As Wisconsin residents thinking about divorce evaluate the process, one of the first considerations should be the financial impact. While divorce may seem necessary to end a failing relationship, the financial aftermath can be devastating for both parties. Heading into the action without a realistic view of mutual finances could leave an individual vulnerable to making bad decisions.
By securing the assistance of a financial adviser at the beginning of the process, it is possible to work on collecting relevant information about accounts and assets. Having one’s own adviser is important. Although some couples will share the expenses and expertise of one financial professional, there is a risk of advice being skewed in favor of one party over another.
A financial professional can evaluate the outstanding debt as well as assets that will be at play during the property division phase of the divorce proceedings. The adviser might research issues such as property liens to ensure that an asset under consideration is not actually bogged down by unknown debt. Equity loans and second mortgages could create unexpected financial obligations to the party who receives a family home, especially if that person is unaware of these issues.
A financial evaluation of the situation prior to filing for divorce provides an individual with the ability to consider potential trade-offs that would be acceptable as property division is negotiated. The tax implications of various assets can also factor into decisions related to assets such as retirement accounts. Additionally, this allows time to tackle issues such as closing joint credit accounts prior to initiating divorce proceedings.
Family lawyers may coordinate with financial advisers to help their clients set financial goals related to the divorce process. As certain interests such as keeping the family home are expressed, these professionals can provide the pros and cons of pursuing those interests in light of the full scope of financial information.
