Money In Divorce
Keeping a secret fund in case of divorce
Some divorce professionals encourage both partners to be involved in family finances and even have secret funds tucked away. A secret fund can be filled with money from non-marital assets such as inheritances and previous savings. The fund does not even have to be a secret if a partner is smart in the way the fund is set up. A partner could also elect to make a prenuptial agreement keeping it separate.
On the other hand, secret funds can lead to distress in a marriage. Second, if one is not careful about how the fund gets set up, he or she can be charged with trying to hide assets during a divorce. Hiding assets is a serious issue and can lead to a lot of trouble.
Wisconsin is one of a few community property states in the country. That means all marital property is divided equitably between spouses. All marital assets and finances are split right down the middle. However, the division of the property can still be complicated. There can still be a fight over who gets what particular asset. Anyone getting divorced should consider seeking professional legal help to ensure property division is handled fairly.
Financial tips for post-divorce
Among the most important steps are planning for your future before the divorce proceeding ends. This means developing a budget to live by, and establishing a plan to generate new, or additional, income. As it can be a difficult process, establishing an independent line of credit before a divorce is finalized is another important step.
Yet, perhaps one of the most important steps in preparing for life after a divorce is preparing for the financial discussions of the divorce itself. Often, alimony payments, property division and child support play a large part in the financial security of an individual after a divorce. By preparing to mediate or go to trial for a fair split of the assets, an individual can help secure their financial wellbeing after the proceedings are finished.
Should you be concerned about unexpected post-divorce expenses?
In order to ensure everything is divided fairly, a couple needs to look deeply at all their expenses. It is easy to miss some things. First, a discussion needs to be had about health insurance. A wife may have been on her husband's insurance for years and suddenly find herself needing to buy her own after the divorce. Health insurance can be costly and should be factored into spousal support payments.
Second, homeowner and car insurance need to be addressed. If one spouse keeps the home how will the insurance be covered? Third, there may be tax issues the couple needs to discuss. Tax payments need to be budgeted out of alimony payments to ensure the receiving spouse can pay the taxes and still support herself. Finally, the cost of memberships to gyms or clubs needs to be discussed. Often membership plans for a single person are more expensive than a family plan. How will it be paid for?
These are just some of the examples of post-divorce costs that can end up being expensive. They should be discussed and planned for. In Wisconsin, the laws are designed to ensure that both people involved in the divorce are treated fairly. The state follows the community property law, which means that all marital property is supposed to be divided equitably between the spouses. However, even the state misses some things. Couples need to be aware that the income that was formerly supporting one household is now supporting two. Some sacrifices may need to be made, but some can be avoided by proper planning.
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