Getting divorced in Texas? Learn more about financial mistakes to avoid
Divorce is never easy. But, there are some pitfalls many divorcing couples fall into that make it more difficult than it has to be.
Financial considerations are one of the most important aspects of divorce. If your marriage is headed toward divorce, there are a few common financial mistakes that you should do everything in your power to avoid.
Getting informed, keeping emotions in check, preserving liquidity can be important
When a marriage ends, the divorcing couple must settle on how property acquired during the marriage will be allocated or ask a judge to do so on their behalf. Some Texas divorces also involve spousal support (sometimes called alimony) that consists of payments one spouse makes to the other to provide financial assistance for a given amount of time during or after the divorce.
When going into divorce, it helps to avoid having unrealistic expectations. In Texas, all assets acquired during the marriage belong to both spouses. Even though this does not necessarily mean all property acquired during the marriage will be divided evenly, it does mean that your spouse has an ownership interest in certain items that may “feel” like they belong only to you. For example, a 401(k) or IRA funded during the marriage, even if it is only in the name of one of the spouses, belongs to both spouses.
It is the very nature of marital property that makes it so easy to slide into another divorce mistake: protracted conflict using money and assets as a weapon to inflict emotional damage. There is no doubt divorce is an emotional process. But fighting on principle and dragging things out just does not pay for anyone. Emotions should be separated from the finances of a divorce; that does not mean you should give up ground or cannot take a strong stance as to what you want financially, but fighting for the sake of fighting only drives up the cost of the divorce for both spouses.
Finally, there is the concept of liquidity of assets to consider. For many divorcing individuals, it is important to get one particular asset, most often the house, but sometimes it is a similar illiquid asset like a family business.
The family home might be the most valuable asset a couple owns, and to get a full ownership interest in the house, one spouse will have to give up other valuable assets. The problem with the value of a home is that it is not liquid – in other words, it cannot be easily converted into cash. Mortgage payments and upkeep costs can quickly become onerous once one household becomes two, and those who have not built enough liquidity into their divorce settlement could find themselves in a tight spot.
Get help with your divorce from an experienced Texas family law attorney
Making a financial mistake during divorce can cost you big, but fortunately these mistakes are relatively easy to avoid if you are cognizant of them and get the right legal help. If divorce is in your future, an experienced, passionate and ethical family law attorney can help you get what you need in the settlement. Talk to a Texas family law attorney today about your divorce.