Florida couples engaged in divorce proceedings already know how emotional a separation can be. However, many get caught off-guard by the hidden financial pitfalls that often come along with the dissolution of a marriage. There are a number of mistakes that divorcing couples make regarding personal finance and tax liabilities that can present monetary challenges for years after a divorce has been finalized.
According to some analysts, the reason for these financial challenges is that people fail to plan for a reduction in income after a divorce. These exes might finance large purchases or withdraw funds from investment accounts without considering repayment requirements based on a single income. Similarly, receiving the deed to a shared piece of real estate in a divorce can carry financial risks when factoring in upkeep, repairs and maintenance costs.
Taxes are also a cost associated with divorce that may be easy to ignore during the turmoil of a separation. Everything from spousal support payments to pension and investment savings can be affected by a divorce. Furthermore, the changes and complexities in tax laws can leave some feeling confused regarding liability. That’s why soon-to-be exes, especially those with higher incomes or substantial assets, should consider working with financial planners.
Due to the many facets of financial planning that come into play after a divorce, it’s also wise to seek legal guidance. An attorney can provide strategic planning services to a divorcing spouse who is dealing with complicated issues like asset division, spousal support payments and custody agreements. Such an attorney may also act as a representative in court if negotiation efforts require a divorce motion to be argued in front of a judge.