A Few Pre-Divorce Suggestions:
• Close any joint banking accounts.
• Open accounts in your name alone and start having any income deposited there.
Close all joint credit card accounts by paying the balance down.
• Refinance any property that is held jointly into the name of the spouse who will take possession of the property post-divorce.
• If you have no income, re-enter the work-force and start rebuilding a career.
-Before divorcing each partner should go over their entire financial accounts and assets and make sure that everything and that means everything is included.
-Everything should also have any notes attached to them such as how does this impact our future or how is this situation rectified or when (and this is very important) does it take effect.
-Does everything happen now or do some things happen later. It must be made explicitly clear how each item works. What looks simple to a layman (the two spouses) may actually be totally different to the law.
-All valuable or expensive items need to have all details spelled out exactly what will happen right away and maybe even in the long run.
It may even be useful to make sure that a long-term payment schedule be written out to make sure that each partner understands what will happen immediately and what will transpire into the future.
-A checklist of all items and finances and such things as insurance and wills must be looked at carefully. Never take a simple or lazy approach. It may just be one person’s undoing. Divorce is a serious division of assets.
Houses, cars, bank accounts, insurance and wills are very important to tackle in great detail.
-I think that in divorces it should be made very clear to each person that they should ask questions over and over again and never worry if it sounds like a silly question. Ask the questions and make sure there is a clear written answer separate of the actual divorce proceedings so it is as well understood as possible.
-Apart from custody of children, aren’t money and property the big issues in divorce?
Things get even worse and more expensive when the spouses stop talking to one another and communicate only through their attorneys.
-it’s possible to have different divisions of assets that all meet the 50/50 requirements of the law but have profoundly different financial consequences for the divorcing partners.
-If a home is at stake, then, pay super special attention to what is happening.
-People want it settled tomorrow. Emotions often determine the choices rather than making the numbers make sense. I say to people, ‘Let’s slow down and do the math.’” He says it’s common for partners to make hasty, ill-advised decisions about asset splitting just to avoid conflict. “Sometimes in relationships where there is an imbalance of power, one person might simply capitulate, resulting in a financial decision that may have negative consequences down the road.”
-Don’t ignore the tax implications. “One of the biggest items that is often overlooked in separation and divorce agreements is tax deductions, such as child-care expenses, and credits that may apply to separated and divorced parents,”. For example, a divorced parent can claim one child as a dependent, but both parents cannot claim the same child.
-Certified Divorce Financial Analysts usually charge between $175 and $250 per hour. “If people do their homework and bring in all the relevant financial information, we can usually get a fairly good handle on the situation in two hours,”
a better understanding of your financial situation can save your lawyer’s time, which is much more expensive.
-Divorce proceedings will cost money. Just how much depends on the route taken.
There are simple divorces that are uncontested and may cost a few thousand.
There are contested divorces that will cost over 10,000
And there are court case divorces which will cost a lot of money. Here the lawyers are the big winners. It is expected that court cases will start at around 50,000
-The other cost of divorce is the effect on the family members. The emotional problems will be felt in the direct family as well as relatives and even at work. Kids may be a special case although some spouses take it exceptionally hard as well.
The problems of finances can also take a very heavy toll.
-Laws concerning common-law separations vary by province or state.”
The granting of alimony (also known as “spousal support”) and how it is calculated varies significantly from state to state.
Is it possible that you and your ex-spouse could set up college savings funds for your children, so they will not be disadvantaged by the divorce, but still receive help with college?
In other words, if a split is made will a child still be able to get to college seeing the family’s funds have been split up and the costs are no longer what they were in a single home. A split could cost a child a chance at a college education. College educations aren’t what they used to be but they are still much better than not having such.
-Of course, most things will happen right away because the two people simply wish to get everything over with and not play games into the future.
-Things like pensions may be able to be moved to the future though. In other words, the pension will be split 50/50 when it comes into effect – not before. The problem is getting two people and two lawyers to agree on how situations like this are handled and what is legal and what isn’t.
Divorice Horror Stories
not real names
Pensions
Two weeks after his divorce, Dave Brown received a blunt letter from his ex-wife’s lawyer. It informed him he’d contravened his settlement by not giving his ex her $100,000 share of his pension within 10 days of the divorce.
“It was a knockdown punch,” “I had no idea I had to pay her right away, or that the money would come directly out of my pension fund.” thought his ex would simply get a share of his benefit after he stopped working. “I’d never heard of a company taking money out of a pension eight years before retirement.”
Pensions are very, very complicated assets
With his pension fund depleted, monthly cheques were reduced by over a third when he eventually retired, yet he was still required to pay spousal support from what remained, leaving him strapped. “I had to find another lawyer to help me get out of those support payments I couldn’t afford anymore.”
The man believes his pension arrangement should have been handled differently—at the very least it should have been explained to him properly. “I guess it was just something the lawyers worked out between them,” he says. “My lawyer and I never really talked about the pension.”
It seems hard to believe a lawyer would not talk to a client about how such an important asset would be divided
His situation is just one example of how partners frequently get divorced without understanding all the financial implications.
Watching Debt and Bill payments
This is a great reason why couples should make sure they know what is happening to the couple’s expenses. Only one person should look after the budget but the other person should at least check the accounts (bank, credit cards and credit score)
The financial planner also gave Baron some tax-saving advice on how to invest some money she had brought into the marriage. Since she had that money before the marriage and kept it in a separate account, it was not an asset that had to be shared equally. However, had she used that money to help pay down the mortgage, it would have become part of the value of the matrimonial home and therefore a joint asset.
This is also the case if one spouse receives an inheritance or gift during the marriage. In most provinces, as long as the money is kept in a separate account it does not have to be divided equally after a divorce. But if it is used to purchase a joint asset, such as a house, it becomes the property of both spouses. (In some jurisdictions growth in the value of the inheritance or gift may count as an asset to be shared.)
When Anna Masters, of Taber, Alta.Sue Brown separated from her husband she moved in with her sister and started a new job at a bank. She also applied for a new credit card through that bank, so the person doing the credit check was one of her colleagues. When the Equifax credit report came through, the coworker quietly asked Masters to step into her office. “You are behind in all your bills and credit cards. Most of them are in collections,” the embarrassed colleague said.ex-husband had a line of credit she didn’t know about it, which listed her as a co-signer. Masters says he must have forged her signature on the application.
She got stuck with a big chunk of debt—loans and credit cards her husband was supposed to pay off, but didn’t—as well as the line of credit he’d fraudulently put her name on. “I could only get part-time work at the bank, but I worked every other junk job I could find. It took me three years, but I paid off my share,
Another Debt story
A man tried to remortgage his house not long before he and his wife split up. “When the credit check came in the banker said to me, ‘You’ve got debts you didn’t tell me about. You’d better go home and talk to your wife about it,’”. These debts were considerable—between $30,000 and $40,000 in unpaid credit card balances. Fortunately, the man’s ex-wife eventually agreed to take responsibility for them.
It would be great if in fact there was a calculator made for divorces so it can be simulated what will happen when the divorce takes effect. That way neither person will be as easily duped or ripped off.
Maybe that is a great idea and a calculator could be made for Your Budget Plan.
I haven’t seen such a thing. Maybe it would be another special thing that YBP could claim to have that other companies don’t have.