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What financial issues should you consider before a divorce?

On Behalf of | Apr 30, 2020 | family law and divorce | 0 comments

The stress of divorce is difficult enough with the addition of financial worry. There will always be a fear of what you cannot control, but to know the different financial issues ahead of time can help you to prepare. 

According to Forbes, there are several financial considerations to take into account before your split. 

Debts follow your split 

When you divorce your spouse, your debts do not disappear. In fact, both of you continue to have a financial responsibility to pay your debts. Your credit cards may become a complicated matter. It is crucial that you know whose name the credit cards are under and what the balances are. Your divorce decree does not cancel out any of your debt. This goes for any credit cards and any mortgages that the two of you have under your name. 

Divorce has tax implications 

Do not forget about your taxes. If you were married for the last five years, you should have copies of those returns for five years. When you file as a single person, your tax rate will be higher and you do need to consider this when you file taxes after a divorce. Likewise, you must factor in your children and whether you or your spouse can claim them. 

Real estate must split 

Real estate is among the major assets that splits during a divorce. Real estate will include your family home, your vacation properties, rental properties and any other property that the two of you share. You will have to decide whether to sell the property and split the expenses or who will receive which properties.