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Beware of financial disaster in divorce

On Behalf of | Aug 29, 2023 | high asset divorce |

Anyone filing for a divorce in Minnesota this year will want to avoid any financial pitfalls that others have experienced. One of the best ways to do so is to live within one’s means. That means taking stock of one’s financial circumstances and figuring out a realistic budget.

If an individual is navigating divorce proceedings and is spending more money than is coming in, it is laying the groundwork for financial turmoil. On the contrary, cutting spending, making sure debts are paid and saving money whenever possible sets the tone for solvency and financial independence.

Decide whether to sell certain assets ahead of time

Hanging onto all assets might seem like a good idea at first, but some assets incur steep capital gains taxes and others cost a lot of money to maintain. Decide whether to sell the marital home, a vacation property, an extra vehicle or another asset. Sometimes, it is better to sell and deposit the proceeds in a savings account or to generate income with an investment. The bottom line is that financial disaster is less likely to occur when smart decisions are made regarding assets.

Consider possible future expenditures

Those who don’t think ahead could be left footing an enormous bill for expenses that arise following a divorce. For example, many spouses wind up having to hire people to do things their spouse used to do, such as make home repairs or mow the lawn. All financial issues are part of property division, alimony and child support proceedings. Consulting a family law attorney can help protect assets and avoid financial disaster in a divorce.