Assessing your finances before choosing to divorce

Before asking for a divorce, the spouse thinking of divorce must decide if that is truly what they want, from both an emotional and financial perspective. While the emotional side of whether or not to ask for a divorce is nebulous, the financial perspective can be more objective. Further, assessing one’s financial situation pre-divorce and potential financial situation post-divorce can be a key to determining how to conduct a divorce or even whether to initiate a divorce. This is especially true during the property division stage of the divorce process.

Of course, with some caveats, spouses can decide how their assets are divided between themselves or through an alternative dispute resolution process. In a non-contentious divorce, the alternative dispute resolution process can be a cost effective way to gain the best possible post-divorce financial outcome. However, when that is not possible, asset and debt division (known as equitable distribution) is left to a Divorce Master.

Divorce Masters look to determine what is fair based on the individual facts of the case. The focus is on dividing “marital property” equitably, not necessarily equally. Additionally, there are a variety of other factors that can affect the court’s decision, like separate property, health issues, and who has custody of any children.

The concept of equitable distribution can become complicated. For example, if one tries to hide assets, the process can become costlier to both spouses and take longer. Additionally, depending on the nature of the marital assets, it may be necessary to consult a CPA, actuary, or a business valuator. These professionals, with your attorney, can go through a couple’s finances to develop a snapshot of their marital estate and use that picture to recommend potential settlements.

If you have questions about the financial elements of divorce, you should consult with a qualified family law attorney.