Family Finance: How to deal with impacts of divorce
Going through a divorce is never easy, and yet, sometimes that’s the only action left to take. Separating physically is one thing and it certainly takes its toll on both parties involved, but separating finances is a whole other ballgame. Each situation is different and requires our full attention so there aren’t any oversights as everything is being taken care of. It is imperative that both sides understand what a divorce brings to the table, or rather, what it takes from it.
List all the assets
If the decision is final, then the first step has to be a large list of all current assets. Marital assets include the car, the house, any stocks, tax refunds, artwork, tools etc. All of these are subject to division and some will even require appraisal to determine their worth. Any future alimony payments need to be taken care of early on, all and any costs should be noted down as it will be inevitably brought up once you head off to an attorney. Depending on the laws of the state you’re in, the division of property will be governed by your state’s laws, all the more reason to have all your cards on the table.
Figure out what goes where
Once the list has been completed comes the difficult part – settling who gets what. Depending on the reason for divorce and emotional background, this issue can be solved in a few minutes or it can drag on through court. For the sake of everyone involved, especially if there’s children involved, it is important to stay civil and handle everything in a timely manner. The longer it drags out, the harder it will be for your finances and the emotional state of everyone involved. This can lead to complications when the state decides what goes where and can make even more problems for one side.
Make sure both parties agree
Building on the idea above, it is imperative that both parties agree on what goes where. Both sides have equal rights to the assets from the marriage during separation, including things like the house. This essentially means that both sides have equal right to live in the house post separation and neither side has a say in it until the entire thing has been finalized. This can add to the already tense situation and affect each other’s working schedules and seriously impact their ability to make rational decisions about further steps.
Check your insurance and bank accounts
Divorce comes with the added benefit of figuring out which stack of paperwork to delve into first. The joint accounts need to be handled and the respective banks need to be notified about the divorce. This puts all funding on a sort of “hold” and prevents either side from cleaning the entire thing out while the divorce is still getting finalized. Insurance is usually overlooked but it can completely turn on its head during a divorce. Keep track of who’s insured through whose plan and make sure everyone has a good backup if they stand to lose their insurance after the divorce.
Take it to professionals
At the end of the day, when all is said and done, there will come a time for professionals to step in. These people have dedicated their lives to solving disputes and have in-depth knowledge of the system and its flaws. There are far too many intricacies concerning family law to get into on your own, which is why both sides should start talking to their lawyers. Sydney has seen a great increase in dependable law firms over the years, for example, and the situation is similar in other big cities. So, gauge your options and start the negotiations when you’re ready.
No need to sugarcoat it, it’s not going to be pretty. The emotional impact is hard enough without muddying the waters with talk of finances and the division of property. However, these things are necessary to prevent any future problems and, in the end, will save everyone’s time and money. To avoid any legal hassle, be civil and go through everything one step at a time, list everything you own, go through the accounts, settle on the house and then go to a lawyer – no need to rub salt in the wound.