Money Matters: Article I

Divorce is often devastating financially. In my case, my ex went bankrupt with our family business and we lost just about everything. Talk about starting over…. So, I decided to download some information on money matters to help you cope.  One of my readers has published a book and when I can find out more information about her book, I will post this as well. Have not been able to reach her.

In the meantime, I found three articles about money & divorce, all  of which appeared in a few days of one another. Here is the first one:

Getting a divorce is a messy business, both personally and financially. Don’t be in such a hurry to reach a settlement that you make these costly financial mistakes:

Having unrealistic expectations. “Divorce will put a cramp on your lifestyle,” asserts Violet Woodhouse, author of Divorce & Money: How to Make the Best Financial Decisions During Divorce. One household is about to be split into two. Unless you’re a rock star–or a Rockefeller–expect money to be a little tight.

Not communicating. If you don’t share information with your spouse or your lawyer, you’ll just end up paying for the legal work it’ll take to get it.

Getting into an endless battle. Turning the courtroom into a battleground will drain your emotions and your finances. Pick your battles wisely and “don’t end up paying for your lawyer’s kids’ education,” advises John Crouch, a family law attorney who practices in Arlington, Virginia.

Getting hung up on the numbers. A fair split is not necessarily an even split. Woodhouse counsels her clients to assess their tolerance for risk before deciding how to divide their financial assets. One spouse may not mind taking over a risky stock portfolio; the other may prefer the relative security of a bond fund.

Focusing on the present and not on the future. Make sure you understand the financial implications of your decisions. Rather than accepting a BMW worth $35,000, for example, consider taking a mutual fund with the same current market value. The car will depreciate; the fund, if chosen wisely, probably won’t.

Forgetting to assess tax. Don’t forget to factor in the tax costs of every financial decision you make. For instance, two stock portfolios of seemingly equal dollar value might really be worth completely different amounts, depending on capital gains.

Overlooking important information. In the struggle to keep your divorce simple, make sure you have information on absolutely everything that will affect your financial future: all assets, investment funds, retirement pensions, and so on.

Failing to untangle all joint finances. Keep your finances mingled and your financial future could be jeopardized if your former spouse defaults on payments, commits fraud, goes bankrupt, or becomes disabled. You might also be liable for any debt that your spouse has incurred under your name. Make sure you have worked out a way cut or minimize all financial ties that bind you before the divorce rather than after it.

Failing to take into account the amount of time you’ll to get your career back on track. If you gave up your career when you got married, it probably won’t be easy to jump back into the workforce. Don’t be surprised when the costs–both financially and emotionally–of resuming your old business turn out to be greater than you’d thought.

From: Top Financial Divorce Mistakes by Leah Hoffman


3 Responses to “Money Matters: Article I”

  1. Paula Buchak says:

    Good advice for those dealing with divorce now.

  2. Lawyer says:

    If you think you were lead into a pyramid scheme and you would like your money back – see John Lawrence Allen –

  3. NO, I wasn’t, but thanx anyway. es

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