Don’t overlook these 8 financial Matters.

In a relevant article published by Cheryl Munk at Barron’s, there are 8 important areas to not forget during a divorce.

• Identify all income and assets. Don’t overlook such items as vacation properties, credit card points, frequent flyer miles, insurance, and safe deposit boxes.
• Check the fairness of the asset split based on aspects such as inflation, cost of living adjustments, taxes, etc.
• Check the tax impact of asset divisions. There are capital gains tax impacts when selling assets. Other things to consider are who will claim children as dependents, or future tax returns impacts.
• Don’t forget life and disability insurance costs on the breadwinner. You want to guarantee premiums are paid. Even the cost of long-term care insurance should be negotiated.
• How to divide retirement assets should be planned.
• Who will pay for children’s education through college should be planned.
• Make sure you are removed from all joint credit cards and other joint accounts and that current debts owned are correctly allocated.
• Update beneficiaries on all accounts and policies.

For access to the full Barron’s article, click HERE

Who is Responsible for Debts?

Generally, like the division of assets, debts incurred during marriage are divided equally. Separate debts are normally those that are incurred prior to marriage or after the date of separation and are assigned to the debtor spouse. However, like the division of assets, the characterization of debt is not always clear and there are exceptions to the equal division rule. For example, if the community debt exceeds total community assets, the Court is permitted to assign more community debt to one spouse if it is more likely that they will be able to pay off the debt. Furthermore, determining the date of separation can be complicated, and has a significant effect on the assignment of debt. As such, having an experienced attorney assist you in defining the date of separation can have an enormous impact on the outcome of your case.  

Divorce 

With few exceptions, a judgment of dissolution of marriage may not be entered unless one of the spouses has been a resident of the state of California for six months and resident of the county where the divorce is filed for three months prior to filing. You do not need to live with your spouse, or even live in the same county as your spouse to file for divorce. So long as one or both of you have resided in the county where the petition is filed for at least three months, the court can hear your case.  

Legal Separation  

If neither you nor your spouse meet the residency requirements to file for divorce in California, as an alternative, you can file a petition for legal separation. While a petition for legal separation does not terminate your marital status, legally it allows for the resolution of the same issues in a divorce. Additionally, once you meet the residency requirements, you can amend the petition and ask to terminate marital status.