Regardless of the economy, or your reasons for pursuing separation, here are some questions that are critical to answer when financially preparing for a divorce:
- Do you have a clear understanding of your current financial picture or does your spouse manage all the finances? Do you have access to all of your household financial records, including accounts in your spouse’s separate name?
- Do you have retirement accounts, such as a 401(k), IRA or Thrift Savings Plan? Do you own stocks, bonds or mutual funds? What are the relative values of accounts in your name versus your spouse’s name?
- Have you thought about your post-divorce financial future and determined how much income you will need (from all sources, including employment, support payments and retirement) to maintain your marital standard of living?
The financial implications of divorce are unique to each relationship. Current economic conditions, including a depressed stock market, high inflation and rising interest rates, could have a direct impact on the value of your estate and cost of living post-divorce. Recent developments have decreased the value of many assets that are connected to the fluctuating market, including retirement accounts, investment accounts, employer stock options and even real estate. If these assets have accumulated during your marriage, they are likely marital property and thus subject to equitable distribution under Virginia law. Determining their worth should therefore be at the center of your divorce planning.
It is quite common for only one party in a marriage to be responsible for the finances and even more common for only one party to manage all investments. If you are not involved with your finances or if you have large or complicated assets, you may find value in consulting with a financial advisor, a Certified Divorce Financial Analyst, a tax professional, a realtor, an estate planner and of course, a family law attorney. A good family lawyer can help you determine which professionals to engage to gain a better understanding of your financial situation and options. While not everyone needs professional financial guidance, expert advice on the valuation of assets and debts, tax implications, and division of retirement accounts can be a critical tool. Having a clear picture of your financial landscape puts you and your attorney in a much better position to negotiate for your post-divorce financial life.
Even if the economy is struggling, you should not have to. There are many intricacies to consider with the division of assets and liabilities in a divorce, and it is important to protect yourself. Be sure to consult with a family law attorney who can help you navigate your financial future. Livesay & Myers, P.C. has a team of experienced family lawyers across five office locations in Northern Virginia. Contact us to schedule a consultation today.