Spokane residents who have gone through a divorce understand that it can take a hefty financial toll. While divorce may seem like the beginning of a new chapter in your life, it can also mean increased bills and unforeseen expenses not originally contemplated when signing the dissolution papers.
In the middle of a divorce, the majority of your focus may be on getting through each day, and on your emotions. When the smoke clears, you may be left with some stark financial realizations. However, understanding what to expect financially after a divorce may help prepare you for the sticker shock that may potentially come later down the road.
As we discussed last week, a divorce may change the way you file taxes this year, which may impact the amount you will have to pay, or lessen the refund you may be expecting. Additionally, childcare expenditures may increase as well. One parent will likely be paying child support, and the parent who is not paying child support will have to pay for all the costs of raising a child up front. If child support payments are not made, or missed, the parent with custody will be forced to shoulder the financial burden.
Additionally, many recent divorcees forget about planning for their future. As a result, rethinking a retirement plan may be necessary. Perhaps the most forgotten and sometimes most expensive cost after a divorce is loss of insurance. Depending on the arrangement during a marriage, losing a spouses' insurance can mean that you may become uninsured. Depending on your age and health, finding a new insurance company can be difficult or may be financially impractical.
When going through a divorce, it is easy to focus on the short-term legal aspects of the proceedings. Florida is an equitable distribution jurisdiction, which means that a judge will typically decide what will be equitable division of assets between the parties, which may not always be a split down the middle. A judge will also look at community property, separate property and property purchased with co-mingled funds. A divorce can truly be a life-altering event. Not only does it take a great emotional toll, but as discussed, can have a lasting financial impact on your life. An attorney can help advise you on how best to plan for the divorce, as well as inform you of your legal options.
Source: Forbes, "5 Ways Divorce Takes Your Money," Kenneth Rapozza, March 12, 2013