26 Dec A New Year: A New Start and a Divorce
A New Year. A time for a fresh start. We’re betting that even those who hate New Year’s resolutions still make silent promises to themselves that this will be the year they finally lose ten pounds, take that trip to Disneyland they’ve been promising their kids or visit their folks more often. And for the many married couples filing for Divorce, the New Year will be the time for major life changes that will have a profound effect on the lives of their families.
Divorce rates increase by one third in January
According to the American Academy of Matrimonial Lawyers, the number of Divorce filings is one third higher than normal in the month of January. Unfortunately, too many couples are more focused on ending a bad relationship than they are on taking the time to fully understand the process involved in dissolving a marriage.
Preparing for Divorce: Understanding the financial implications
The most important preparation for Divorce should include understanding the financial implications of dividing property and starting a new life as a single adult or parent. Each spouse needs to have a firm understanding of what and where all of his/her assets are and the most equitable way to divide them. If there are children, identifying custody and a parenting plan are critical parts of the Divorce process.
People considering separation should review their taxes
Most of us receive our end-of-year tax forms in January, so this is the perfect month to review your earnings as well as your debts. Gather copies of documents that verify assets, liabilities, income and expenses–bank, brokerage and retirement statements and real estate documents.
Money and children are the most contentious topics for divorcing couples
Having a firm grip on your assets and liabilities puts you in a better position to negotiate and reach an equitable financial resolution. Many people are surprised at the amount of debt their spouses are carrying, which may include credit card debt that is easy to accumulate and difficult to pay down. California is a community property state, so that which is accumulated during marriage is a shared responsibility—which can become problematic when it comes to time for division of property.
Run a credit report on yourself
One financial adviser recommends running at least one credit report on yourself, as there may be debt about which you may be unaware. It can be shocking to learn that you potentially owe thousands of dollars because you have agreed to personally guarantee loans or have unknowingly underwritten other financial commitments. This kind of thing can happen when one spouse manages the couple’s finances and the other spouse remains uninformed about the couple’s fiscal affairs.
Review retirement plans and insurance policies
Review retirement plans and insurance policies to determine what changes need to be made to take your spouse off the policies and protect minor children. Something to think about: You want your life insurance proceeds to go to your children; however, if the children are minors at the time of a parent’s death, the receipt of a large sum of money is complicated. Even if a child is 18 years old and legally an adult, the receipt of a large amount of money may not be prudent. It might be better to name a conservator who would be responsible for managing the money and overseeing the wellbeing of children until they are able to care for themselves independently. If you have a Living Trust, Power of Attorney and Advance Healthcare Directive, you likely will want to make changes to these documents as well.
Saving money and stress with CDP’s Uncontested Divorce
California Document Preparers has assisted hundreds of Bay Area couples with their Divorces. We are the service providers of choice for an increasing number of couples who do not require an attorney to get divorced because they are not fighting over custody of their children and they are able to determine an equitable division of property—these are the fundamentals of an uncontested divorce. We help our clients save money and stress at what is already a very difficult time for families.
We guide our clients through the step-by-step Divorce process
Our clients fill out our attorney-approved workbooks, and we prepare the legal documents and file them with the courts. We manage the entire process and remain in touch by phone and email. Our dedicated team is compassionate and helpful; we understand the emotional impact of Divorce and work hard to make the process as seamless as possible.