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Beware of the potential financial pitfalls of divorce!

On Behalf of | Jan 25, 2017 | Divorce |

There’s hardly ever a single reason given by those who end their marriages for what prompted their decisions. If you are soon entering the divorce process, you might relate to the fact that various events and situations combined can simultaneously act as causal factors in a marital split. No one’s circumstances are exactly like yours, and depending on several things, you may be headed for a simple process or one wrought with contention and serious challenges regarding unresolved issues.

You likely have invested many years of effort providing for your family, setting aside some savings and making investments that align with your immediate needs and long-term financial goals. The last thing you need is to face a drawn out battle in a Texas courtroom over assets and other finance-related issues.

Things to know upfront

You know what they say: An ounce of prevention is worth a pound of cure. It may be best to arm yourself with as much information as possible before starting divorce proceedings. For instance, the following facts may be of particular interest:

  • Texas is a community property state. This means everything there will be an equal division of assets between you and your former spouse in divorce.
  • Regarding any financial matter where there is disagreement, the court has the final say.
  • Hiding assets is illegal, but is not uncommon in high net worth situations where one spouse is trying to keep the other from taking advantage of a particular situation.
  • Generally speaking, it is always best to practice full disclosure of assets.
  • Valuations are typically required before the court makes any final decisions in divorce that includes business assets.
  • Where children are involved, the days are long gone where the highest earning spouse is automatically obligated to pay child support.

Such details may help you make informed decisions regarding your own present and future financial situation. While it’s always best to maintain a high level of cooperation, it’s not always possible, especially if a former spouse refuses to cooperate.

Protect yourself

You obviously didn’t come this far to lose everything you’ve worked for through the years. Ending a marriage with many assets involved is seldom easy, but a severe communication breakdown or argumentative attitude can seem unbearable at times. Others who have faced similar challenges in the past have found one or more of these ideas useful:

  • Becoming as independently fiscally stable as possible in the aftermath of divorce might help prevent problems borne out of financial dependence upon a former spouse.
  • Although many people assume their houses are their greatest assets, this is not always true. Estimated future income from your or your former spouse’s retirement account or pension may indeed be of higher value than your house.
  • Child support doesn’t qualify as taxable income for a recipient nor as a deduction on a payor’s tax form.
  • In addition to dividing assets equally, there is a 50/50 for all liabilities in a community property state as well.

Basically, the more you research ahead of time and the better prepared you are, the higher chances are that you will obtain a favorable outcome in court.

Calling in reinforcements

Just as you might consult with a certified accountant with regard to your financial portfolio, investments and other money-related matters, there are people who can help you navigate the divorce process as well. Any questions you have about Texas law or what you can do to minimize the potential negative financial impact of divorce can be addressed alongside the guidance of an experienced family law attorney.

As your personal advocate, a skilled attorney can negotiate on your behalf and is prepared to aggressively litigate any of the issues you face if necessary. Allowing an experienced lawyer to represent you in court can help protect your assets, avoid emotional outbursts and achieve a swift and agreeable settlement.