Going through a difficult divorce during the COVID-19 pandemic can be bad enough, but your difficulties will multiply if you lose your job or face expensive medical care. You may need to file for bankruptcy as well as get a divorce. Even if you don’t catch the virus or lose your job, divorce adversely affects most family finances and is the leading cause of bankruptcy in America. If you and your spouse are considering a divorce and filing for bankruptcy at the same time, you … [Read more...]
How Much Does Divorce Cost?
It’s a great question. And a question for which everyone wants to know the answer, but no one seems to be able to. The truth is that it can be answered, just not with a hard, up front number. The answer depends in part on which process you choose and how much you and your spouse are willing to work together. Let’s do a little compare and contrast. First: The Traditional Litigation Route This is the route people know from tv shows. You file a petition and your lawyer prepares what is called … [Read more...]
Five Things To Know About Taxes And Divorce
Divorce has significant effects on your taxes. For example, if your divorce is final by December 31 of a tax year, the IRS will consider you unmarried for that entire year, so you must file individual rather than joint tax returns. Moreover, due to new tax legislation, alimony is no longer deductible for the person paying and it not taxable to the recipient. It’s possible to go back and change a prior decree to make alimony no longer tax deductible, but changing a divorce … [Read more...]
Top 3 MORE Overlooked Financial Issues During Divorce (Part 2)
Divorce is commonly seen as one of the most stressful experiences one will ever go through. Along with all of that stress, you are also making financial decisions that will most likely affect the rest of your life and perhaps the lives of your children as well. For that reason, it’s always a good idea to get the advice of a Certified Divorce Financial Analyst™ or some other financial professional during your divorce process. Having another set of eyes on your situation is … [Read more...]
Understanding Alimony in Texas
Contrary to what many people think, Texas does have “alimony,” and the Texas Family Code calls it spousal maintenance. However, the Texas Family Code narrowly defines when spousal maintenance can be ordered by the court. When clients want or need spousal maintenance, I suggest using the Collaborative Divorce process. Collaborative Divorce provides a transparent process that enables clients, their lawyers, and a neutral financial professional to openly evaluate the needs of the spouses … [Read more...]
Top 3 Overlooked Financial Issues During Divorce
Divorce is commonly seen as one of the most stressful experiences one will ever go through. Along with all of that stress, you are also making financial decisions that will most likely affect the rest of your life and perhaps the lives of your children as well. For that reason, it’s always a good idea to get the advice of a Certified Divorce Financial Analyst™ or some other financial professional during your divorce process. Having another set of eyes on your situation is … [Read more...]
Qualifying Income Issues in Divorce
Although divorce rates are reported to be declining, many marriages still end in divorce. Most people know that a divorce can be emotionally draining, but they don’t always realize how financially draining a divorce can be on both parties. One of the biggest decisions to make while going through a divorce is what will be done with the family home. This is not just a financial decision, but also can be an emotional and logistical decision as well. Do children need to be kept in the same school … [Read more...]
Filing for Divorce? Time to update your Estate Plan!
There are many things we think will NEVER happen to us. One of them would certainly be Divorce, because who would get married knowing it would set them up to go through one of the most difficult and emotionally draining periods of their life? The second NEVER, which sadly does happen, is that we are all at risk of becoming incapacitated or worse, dying before the Divorce is over. And while we sometimes hear horror stories of divorcing couples where the soon to be ex-spouse “got-everything” … [Read more...]
Ask Your Financial Planner: Will Divorce Affect My Credit Score?
A credit score is an important part of your financial well-being. So, it’s no wonder that many clients ask me whether divorce will negatively affect their credit score. After all, a solid credit score post-divorce can allow for job mobility and financed purchases, while a poor score can limit your options. The answer to this question isn’t a straightforward “Yes” or “No”. Divorce is complex to begin with, and there are many misconceptions at the intersection of divorce and credit history. … [Read more...]
How Can You Get Alimony in Texas?
There are two types of support payments available in Texas: spousal maintenance and contractual alimony. Spousal maintenance is authorized by the Texas Family Code and may be court-ordered if the parties meet certain legal criteria. By contrast, contractual alimony is based on IRS provisions and an agreement between the parties. Spousal maintenance payments are strictly limited in amount and duration while contractual alimony payments can be for any amount and length of time. 1. … [Read more...]
