Every divorce is different. It has unique characteristics that make the experience distinctive for each individual. When it comes to a divorce, the stakes are always high. There is a lot on the line such as your bank balance, children, house and just about everything during the legal process. One can easily screw it all up. There are some mistakes which people tend to make. They are a common occurrence during a divorce and that is why you need to be aware of them.
By knowing these top 5 mistakes beforehand, you will come out of a divorce with better results. These top 5 mistakes made in a divorce have been compiled from experience. Divorced people, mediators, and divorce attorneys all agree that they are the most common mistakes that people usually make when getting a divorce. These mistakes could easily damage your chances of co-parenting or having a smooth divorce. So, if you are contemplating to get a divorce or are in the middle of negotiations, then this post will serve as a good checklist to ensure that you avoid the top 5 mistakes made in a divorce.
Settlements Which Assume Status Quo
One of the main reasons for getting a divorce is to determine an equitable split of the marital assets. It requires having an understanding of the present situation, along with the valuation of all the assets. One of the mistakes people tend to make at times is that they only focus on the present and ignore potential future events.
There is always a possibility of unfortunate events occurring during any point in the future such as a considerable depreciation of assets, changes in the children’s health, disability or even job loss. It is vital to take these considerations into account. Complications can easily arise in paying for school when the settlement agreement heavily relies on the status quo continuing. For instance, if school costs are to be split based on salary alone, what would happen if your spouse or even you become unemployed? Unforeseen events can easily pile up and lead to the accumulation of huge debts. It can become impossible to pay off the large expenses which you had not planned for in the first place.
Remember to consider future possibilities when negotiating the settlement. Make sure the financial advisor or attorney considers these potential changes. They should help suggest was to protect you from such risks from unexpected circumstances. In some cases, sharing the risk through insurance or additional language in the settlement could ensure that you do not end up back in court. It can be difficult to revise the agreement once it has been made.
Unrealistic Life Expectations
We normally let emotions cloud our judgment. It leads to having unrealistic life expectations. Decisions regarding whether the house should be sold or who should keep it need to be made carefully. They have practical, emotional and financial implications for both the parties.
One of the many lifestyle decisions faced during a divorce or separation is housing. Unfortunately, many divorces unrealistically expect to lead a similar lifestyle after the divorce. This leads to both parties ignoring the trade-offs and financial implications needed to afford that lifestyle.
Another common challenge faced by parents is their desire to maintain a similar lifestyle for their children. It is understandable for parents to want their children to have the best lifestyle which includes lavish birthday celebrations, annual beach vacations and the desire for their kid to have a car once he/ she is a teenager. One of the parents or both ends up finding themselves crossing the spending budget when they compete with each other through spending instead of co-parenting. The truth is that many divorcees find themselves leading such a lifestyle their entire lives.
If you are tempted to spend more to keep up with your ex-spouse or the pre-divorce life, then you need to stop and ask yourself the following simple questions.
- How would such a behavior impact my children’s views about money?
- If I spend more to compete with my ex-spouse, what am I giving up on due to the financial implication?
- Does the choice only meet the needs of my family now and how would it affect their needs in the next 4-5 years?
Disengaging From the Details
Divorce can easily get messy. Dealing with all of the details can be exhausting, especially in complicated situations. You may need to open up about your personal life during the lengthy legal proceedings. However, to support your negotiations, you also have to gather a huge amount of data. Moreover, the need for data does not end even when the divorce has been finalized.
For instance, it is common when both parties are sharing the costs for the children’s extracurricular activities and doctor visits to keep track of the payments made by them. Even if one of the parents is fully responsible for the costs, the other parent might be the one who transports the kids for the activities or attends the doctor’s appointments.
Whoever pays the bills must keep an accurate record of all the costs that have been paid and can request for proper reimbursement from the ex-spouse. In certain cases, the interactions between both parties can be uncomfortable due to which, one of the parents can simply decide to cover the costs on their own to avoid any unpleasant confrontations. Moreover, if it goes on for many years, the costs incurred by one would be significant. The following steps are recommended as a post-divorce checklist to keep track of the child support payments or any other payment.
- Have a proper record of all the shared costs.
- Set up an automatic payment plan for all the support payments.
- Support payments should only be accepted in a form that is tracked and documented. (Not services or cash).
- If you owe payroll deductions related to support payments, notify the employer.
- If any issues arise regarding payments, document the issues.
One might be surprised to know that the divorce rate is higher for second marriages as compared to first marriages. The truth is that couples run into trouble the second time getting married because of the already complicated financial and life situations.
The dynamic is more likely among those close to retirement as they have less time to recover from adverse financial implications from a divorce. This is why prenuptial agreements are crucial to not just the wealthy but for everyone. It helps benefit you and the soon-to-be spouse.
Prenuptial agreements are documents that help partners consider what might happen if the marriage were to dissolve. Commonly referred to as a prenup, it helps set articulate rules for both the parties to follow such as how long one party would receive long-term care expenses or could stay in the martial house.
Second marriage divorce rates are at a 60 percent these days, hence it is advised that anyone considering remarriage should consult with a lawyer to discuss potential prenuptial agreements and to consider making changes to the estate plan.
Lack of Financial Education
One of the most common mistakes made during a divorce is that many men and women lack a fundamental financial education. Normally, basic financial literacy is acquired with experience and mistakes, instead of an educational setting such as college or high school.
If you try to learn about financial education through the internet, you might find yourself overwhelmed and confused with the sheer volume of data. Another challenge faced by divorcees is that they assume traditional gender roles. Most of the retirement strategies assume that the couple would remain married and age together. Thus, the advice might be inappropriate for divorcees that age alone.
The real challenges which women breadwinners face might be ignored, especially the wage gap between the genders. To counteract the barriers to financial education, it is vital to create a personal balance sheet. It is easy and can be as simple as writing a list of all the assets you own and the debts you owe. Many electronic resources are always these days that could easily link all of your accounts for asset allocation and provide you with financial insights. Once, this has been done, you can start to understand your tax return. It is best to do this before the divorce and consider how the divorce would change the tax return once you are a single taxpayer.
People that take such steps while still married would have a bigger advantage if they were to find themselves in court due to divorce negotiations. By having a solid understanding of the present financial situation and an idea of the future outlook, you can better align your goals for the future. It will help one avoid financial mistakes during a divorce which has life-changing consequences.
Why You Need a Divorce Attorney
You might be tempted to file the divorce on your own when seeking a divorce using court provided information or documents. However, it is crucial to hire a divorce attorney such as St. Johns County Divorce Attorney to help protect your interests. There is no replacement for a divorce lawyer. The following are some of the reasons why you need to hire a divorce attorney.
When it comes to a divorce, having an experienced attorney by your side can help ensure that you receive everything that you deserve. State Laws do not always support an even split of all assets. In most of the cases, the spouse might find himself/ herself being entitled to the ex-spouses retirement or other income.
An attorney is an invaluable asset. For instance, if there are child support or custody issues, debts, assets or future assets, and substantial income disputes, then by hiring a divorce attorney, your best interests would be protected.
Fighting for a divorce on your own can be extremely difficult, especially when the odds are stacked against you. There is no doubt that divorce is a stressful time. However, when you hire a divorce attorney to help complete the divorce, it helps reduce stress. Although the attorney would require information from you, he or she would take care of everything. It will provide you with more time to gather important information. Let the attorney take care of the legal work while you get yourself together.
Avoid Costly Mistakes
People make mistakes due to two reasons when completing a divorce. The stress of the divorce and the complicated legal system can make things difficult to handle. If you forget about a credit card debt or a medical issue or overestimate or underestimate the value of an asset, you would end up making a costly mistake. The mistake might require future legal proceedings or cause financial harm. However, when you hire an experienced divorce attorney, you can rest assured that the case is handled diligently and that costly mistakes would be avoided.
Clear & Binding Agreement
Although the court would review all the divorce documents presented, it is possible for the court to not understand what you try to point out. It might lead to a divorce decree which states something you did not intend. On the other hand, when you hire an attorney, one can be certain that all of the legal documents are accurately stated in favor of your interests when presented in court. Thus, the divorce decree would be free of errors and unclear language.
Even though you can use the court provided documents to file a divorce, it is still possible for there to be problems with filling out the proper forms and providing sufficient documentation and information in favor of your interests. Anyone that goes to court without a legal counsel might find themselves in a situation where the paperwork is incomplete and delays might occur. When you hire a divorce attorney, he or she would handle all the paperwork and ensure that there is no delay.