How you fare in your divorce is largely a matter of your approach to the settlement negotiations. If you come to the table unprepared, you’ll be less likely to leave with the terms you want. Additionally, if you and your divorce attorney are overly-combative or confrontational, the negotiations are likely to stall.
This article will recommend several tips for ensuring your divorce settlement goes smoothly. While you can’t control your soon-to-be ex-spouse or his/her attorney, you can take steps to improve the chances that you’ll receive the terms you deserve.
Prepare A Detailed And Realistic Budget
You might think that you have a realistic monthly budget in your head. But chances are, you’re forgetting one or more expenses. Individuals going through a divorce often miscalculate how much money they’ll need to survive. The most common reason is that they haven’t prepared a detailed budget on paper.
Write down your monthly income and the amount of cash you spend each month on bills, rent, food, and other living expenses. Include the amount you put aside for retirement as well as any cash you’ve saved to pay taxes at the end of the year. That will provide a realistic perspective of your financial needs.
Leave Your Emotional Attachments At The Door
A lot of divorcing couples come to the negotiating table with attachments to certain assets. For example, they might be emotionally invested in their house. The simplest way to “split” a house is to sell it, pay off the mortgage loan, and divide the money that is left over. But when one or both parties are emotionally attached to it, the thought of selling it may be out of the question. That can lead to a long, contentious battle over who gets to keep it. Likewise, couples may be attached to their cars, various real estate holdings, and other items.
With the exception of family heirlooms, try to sever any emotional attachments you feel to your and your spouse’s marital assets. You’ll have a much easier time coming up with a settlement agreement that both of you can live with.
Arrive With The Right Financial Information
Being prepared for the settlement negotiations plays a critical role in taking control of your financial future following your divorce. Prior to the first meeting, gather all the documents that reflect your shared assets. That includes bank statements, brokerage statements, tax returns, and property deeds. If you and your spouse are listed on joint credit cards that carry a balance, gather those statements as well.
The above documents will help ensure you’re not taken advantage of during the negotiations. They’ll also prevent your spouse from doing anything underhanded, such as draining your shared savings account or removing your name from the title of your home.
Seek Help In Reviewing The Settlement Proposal
Settlement offers may appear simple on the surface, but hide complexities that warrant further review. For example, suppose your spouse has graciously agreed to give you the family home. Although the offer seems generous, keeping the home means paying the mortgage, paying property taxes, and paying for upkeep and maintenance. What’s more, you may be subject to capital gains taxes when you sell the home.
It’s a good idea to consult an accountant or financial planner who has experience advising individuals on how to divide marital assets during a divorce. He or she can provide guidance on matters related to taxes, investments, inflation, and related issues.
Work Together To Minimize The Tax Bill
Speaking of taxes, you and your spouse should work to minimize the amount both of you will owe the IRS following your divorce. That means reviewing the tax implications in child support payments, alimony, and the sale of property and other assets. In addition, if you and your spouse file a joint income tax return, you are both liable for any taxes due as the result of an audit.
Here again, it pays to consult an accountant or financial planner about your settlement. This is particularly true if your divorce involves complex tax-related issues that may result in a huge tax bill at the end of the year.
Hire A Non-Combative Divorce Lawyer
The simplest and least costly way to end your marriage is to seek an uncontested divorce. This is a one in which both parties agree to the settlement terms without presenting a threat of litigation.
Sometimes, divorcing couples hire overly-aggressive attorneys. In the process of protecting their clients’ interests during the settlement negotiations, such attorneys might push the couple toward settling their disagreements in court. Fighting over marital assets, child custody, and child or spousal support in front of a judge can be very expensive. Moreover, the results are usually unsatisfactory for both parties.
Hire a divorce attorney who understands the value of avoiding litigation. That individual is far more likely to serve your interests than one who needlessly antagonizes your spouse and tries to leave him or her with nothing.