Going through a divorce can cause an abundance of stress from many different sources. Let your finances not be a source of the stress. Residents of Texas enduring divorce with high-asset accounts can orchestrate a few simple asset investigations in areas such as investments, value after taxation, and insurance coverage.
The best place to start with understanding the net worth of one’s personal finances is to obtain tax returns from the past five years. Once this information has been gathered, =a ballpark figure of net worth can be determined to help you decide what assets could possibly be divided down the middle. When it comes to asset division, not all assets are deemed equal because of taxes and liquidity of the asset in question. For example, a house worth $40,000 and a stock worth $40,000 are not considered equal since it would take much more effort and tax money to sell the house than the stock.
In addition, it is a good idea to check on the current insurance policies one may have and then be sure to separate each spouse’s plans. If there are any beneficiary policies listed on the current insurance, they should be updated, as any directions will override any living will on record. Since spouses are making the transition from being a couple to a single person, the finances will change completely. Most likely, a spouse’sincome and expenses will change drastically to the point where a new financial strategy would be very helpful in order to manage money appropriately.
Making the transition from married to single can be a source of stress and conflict. The emotional toll may be very overwhelming. In order to reduce the impact of the transition, finances are an area of the divorce that can be split fairly and appropriately, being sure to take careful consideration of high-asset accounts.
Source: alicetx.com, “Five financial considerations when you’re going through a divorce,” Paul F. Rycroft, June 7, 2014