Going through a divorce is a very stressful process, if you do not know what to expect going into it.
It is important to know the impacts a divorce can have on your finances when considering a divorce.
Here are Five Financial Impacts to consider in a Divorce
- Support
The court will review financials and determine what support needs to be paid to which party. When children are involved, the court will take consideration to how the kids will need to be provided for. The Institute for Divorce Financial Analysts explains what factors are considered in this Article “What you need to know right now about spousal support- in the United States and Canada”. Support can play a huge role in the ability for a spouse to qualify for buying a home or refinancing their current home in the future. - Property Division
If there are assets, real estate and other property it can cost you a ton when dividing the assets. If there are children involved the assets may not seem equal depending on the distribution of custody of the children. - Social Security and Retirements
If your marriage last for more than ten years, you may be entitled to spousal benefits. A paper by Institute economist Marcus Dillender titled “Social Security and Divorce Decisions” shows that there is a slight increase in divorces just over the ten year marriage timeframe when one spouse is at least 55 years or older. - Divorce Expenses
There are typically a HUGE costs when getting a divorce. Such as; Court cost, attorney fees, moving and much more. If you are going through a litigated divorce with attorney’s, expect your expenses to be very high as custody battles can be very expensive. Consider going through a collaborative divorce. - Living Expenses
Part of the Property division with be any real estate owned. Typically, one parent would like to keep the home. If this is the case, a review needs to be done by a Certified Divorce Lending Professional such as myself, to see if qualification and affordability is met by the person wanting to keep the home. If not, the home may need to be sold and expenses of the sale of home would apply. If you plan to rent, Research local living rents if you intend to rent a home so you are prepared financially for the move.
It is important to consider the financial impacts when going through a divorce so you can make the best decision going forward.
Attend a Collaborative Divorce Workshop to get more information on your options. Is the marriage salvageable? Could a therapist or other professional help? As a Certified Mortgage Planning Specialist, I can tell you if you do decide to get a divorce, the couples who go through a collaborative divorce not only save a lot financially but also save the relationships with their spouse. and children. The amount of money you can save can be great but keeping the co parenting and family dynamic in tact with collaborative divorce is priceless. Consider going through a collaborative divorce.