How to navigate the rough waters of property division
Divorce is challenging for everyone in a family anywhere, including in California. After child custody and child support, finances are often the most contentious issue because the outcome will affect both spouses’ financial footing. This is why many divorcing spouses battle long and hard to obtain what they think is their fair share of the spoils of marriage.
For a divorcing spouse to understand all of the properties, assets and debts to be dealt with, he or she should learn how to organize all financial documents, including tax filings, credit card statements, investment reports and bank and savings account statements, and keep them somewhere safe. These financial documents will be handy during property settlement because the process requires both parties to exchange financial documentation with full transparency.
Once a spouse has organized all necessary documents, the balance on both joint and separate bank accounts should be double-checked. Doing so will give a spouse a better understanding of his or her financial footing, which is the basis of sound decision making. A spouse can then create a budget to cover attorney’s fees, court costs and other unexpected costs.
For spouses who currently face divorce, create a separate account because the income earned following marital dissolution is considered separate and will not be subject to division. By creating a separate bank account, a spouse will also avoid creating confusion during asset division.
Honesty is the real key to reaching a fair and just settlement during property division. Divorcing spouses should be transparent as they discuss every family law issue and thus create fairness and equality. Hiding assets can backfire if the other spouse becomes aware of the deception. Full cooperation also has the advantage of speeding up the process, allowing both parties to finalize their divorce and move on with their lives.
Source: Huffington Post, “Divorce Confidential: The Importance of Being Financially Savvy During Divorce,” Caroline Choi, April 18, 2014