Common Financial Mistakes People Make During a Divorce
Divorces can be emotional and highly charged at times, permitting critical financial mistakes that have long-term effects on future financial stability. Taking a step back to gather a clear picture of your current financial status and future projections allows for rational decision-making when it matters most. Making these common financial mistakes during a divorce is costly.
Rushing Through a Divorce into Settlement
Understandably, most people want the uncomfortable divorce process to be over and done. But one of the biggest financial mistakes in a New York divorce is not taking the time to get a clear picture of your entire financial situation or giving in to the demands of a partner to avoid heated conflict.
A valuable tool in divorce is working with a mediator who offers neutral solutions to challenging financial questions. A mediator can find alternative solutions to problems, allowing individuals to stay focused on the future after divorce instead of finding fault in the other partner. Even when using a mediator to find a middle ground, having a New York divorce attorney present is always recommended so that your best financial interests and equitable distribution are sought in the mediation process.
Failing to See the Whole Financial Picture
New York is a community property state, dividing marital assets and debts in an equitable and just way under the law (DRL §236(B)(5)(d). This definition does not mean a 50/50 split. However, partners in a relationship are often unaware of assets such as retirement accounts and pensions that should be divided equally. Moving forward, understanding what assets and debts qualify as marital property and separate property is essential.
Improperly Estimating Expenses after Divorce
Being the sole maintainer of a household after a divorce can be costly, mainly when children are involved. Their needs must be met in multiple locations, which may mean providing duplicates of the same materials in each home, such as bedrooms, furniture, extra clothing, and anything that a child may not easily transport from one location to another. Any expenses that were once split with a spouse now become the responsibility of each spouse.
Not Seeking Expert Guidance
Couples often forge the paths of divorce without the guidance of experts to avoid additional expenses. Sometimes, this choice is made to prevent a partner from fully grasping the financial possibilities available to them in a divorce, and other times, it is thought to be a cost-saving move. Working with the following experts can ensure that each partner receives the compensation they deserve in a divorce, protecting against hasty decisions that can lead to financial miscalculations.
Ensure the help of the following individuals or teams:
- A real estate agent or appraiser
- Certified divorce financial analyst
- Valuation experts
- Qualified domestic relations order expert
There are additional experts you and your family may benefit from when gathering a divorce team.
Settling for Inexperienced Legal Representation in a New York Divorce
The New York divorce attorney you retain should be ready to aggressively ensure your financial future while being able to work with other attorneys involved to come to an agreement by seeking creative options for complex challenges in divorce. It is possible to have compassion and competency on your side simultaneously, and settling for any divorce attorney in New York City will not serve your best interests in a divorce.
The Law Office of Vivien I. Stark has successfully navigated complex and high-conflict divorces for clients, ensuring they do not fall victim to common financial mistakes. Your financial future matters and our team is here to help minimize the stress and overwhelm that often accompanies a divorce.