New Year’s resolutions are often abandoned at the first hurdle. For others, the desire for a clean slate is so strong that they rush headlong into action without being fully prepared. For California residents who are considering divorce, it pays to remember the fable about the slow and steady tortoise that won the day over the impetuous hare.
Divorce can have far-reaching consequences, so getting one’s affairs in good order is essential. For some, having to deal with financial matters can come as a shock, especially if it transpires that one’s spouse was not as prudent as one may have thought. Marital status affects may areas of finance, including investment and taxation, which may require special consideration. In particular, if there are significant assets involved or if there is a possibility of hidden assets, it may become necessary to engage the services of a forensic accountant.
For most people, a basic understanding of day-to-day financial matters will be enough to begin. If possible, create a list dividing assets into those acquired prior to marriage and those acquired during marriage. Depending on circumstances, one may be able to claim certain assets acquired during marriage as individual rather than joint, but this is an area in which knowledge of state laws comes into play.
Regardless of who held the purse strings, prior to and during divorce, it is important to make proper provision for one’s future. If California residents are willing to negotiate during divorce, it is possible to reach compromises on things that matter most to each party. It may be more beneficial in the long run to exercise patience in setting up long-term financial goals.
Source: U.S. News & World Report, “10 Tips for Handling Investments and Divorce“, Lou Carlozo, Jan. 4, 2016