During a Texas divorce, who gets the house? The cars? The retirement accounts?
Going through a divorce can be draining – emotionally, financially, and physically. From filling out tedious financial affidavits, known as Financial Information Statements and Sworn Inventory and Appraisement forms in Texas, to deciding who gets to keep what, it’s a convoluted and exhausting process. The Texas community property laws make it even trickier.
While all divorces have the potential to be messy and complicated, if you and your spouse are especially affluent, the likelihood of difficulties increases. In order to increase your likelihood that you get everything to which you are entitled, here are some things to keep in mind:
Don’t be in a rush: If you’re the one seeking the divorce, you might want out of your marriage as soon as possible – whether it’s out of anger, guilt, or a rush to be with someone else. But when it comes to something as serious as a divorce, decisions should never be made in haste. It’s worth the extra time to do your due diligence, especially with finances, so that you can be sure you aren’t missing anything like hidden assets in off-shore accounts.
Don’t forget the life insurance policies: People tend to forget that the cash-value of money accumulated in life insurance policies is actually considered a financial asset. If you just lumped them in with other types of insurance like home or auto, you could be overlooking a significant amount of money.
Do remember the taxes: For nearly all aspects of a high-asset divorce, you’ll need to keep in mind the taxes and the financial repercussions they will have on the bottom line. From being taxed on large payouts to making sure that the post-divorce maintenance you agree to is enough to cover your needs after taxes, it’s a critical component.
Don’t underestimate your monthly expenses: When you are determining your monthly expenses and bills, you need to be thorough and exact. Best guesses and estimates will ultimately do you no good, as most people underestimate their expenses. Preparing a thorough lifestyle analysis report will best assist you in determining your actual requirements. From bills to spending habits, it will help you project your ongoing financial needs. A financial advisor can help, too. Bonus: in being thorough, you may also discover financial activities of which you were not aware which could lead to hidden assets you have the right to claim.
Do keep in mind the Social Security benefits: If you were married for ten years, you may be entitled to a portion of your ex-spouse’s social security benefits.
Don’t be emotionally attached to a home. Often, for a variety of reasons, the family home is a point of contention. Just remember, if you keep the house, you may be giving up other assets. And in the end, if you can’t afford to stay in the house, is it worth forgoing other possessions or the cash-value of your ownership interest in the home?
Do get an attorney with experience in high net-worth divorces: Divorces are not all the same. You need a lawyer who understands that and is willing to dedicate as much time as is necessary to represent your best interests.