COSTLY FINANCIAL MISTAKES IN DIVORCE SETTLEMENTS
by Donna Cates, CDFA®, CRPC®
Divorce is an emotionally charged time, and financial missteps can make it even more overwhelming. Here are some of the common mistakes people make during divorce that can have long-lasting effects:
1. Holding onto the House When It’s Not Financially Wise: Although keeping the family home may feel important, it’s crucial to assess if it’s financially practical in the long term.
2. Overlooking Hidden Assets and Proper Post-Divorce Budget Planning: Missing out on hidden assets or not preparing an accurate post-divorce budget can leave you financially unprepared for the future.
3. Dividing Assets Equally Without Addressing Needs & Tax Implications: Splitting assets down the middle might seem straightforward, but it often fails to consider individual needs or the potential tax burdens involved.
4. Misjudging the Value of Executive Compensation & Business Interests: Incorrectly valuing stock options, restricted stock, or business assets can lead to a significant financial disadvantage later.
5. Mishandling Retirement Accounts & Overlooking Tax Consequences: Missteps in dividing retirement funds and neglecting tax implications can jeopardize your financial stability down the road.
6. Confusing Marital and Separate Property: Failing to accurately distinguish between what’s marital and what’s separate property can result in an unjust settlement.
7. Missing Out on Alimony Buyouts and Creative Settlement Solutions: Exploring options like alimony buyouts or alternative settlement arrangements can sometimes offer better outcomes than ongoing payments.
A Certified Divorce Financial Analyst® (CDFA®) can guide you through these potential pitfalls and help ensure that your financial future is secure. This is your opportunity to make the right choices for your next chapter.
Investment advice and financial planning services are provided by Money Matters Wealth Solutions, dba Women’s Wealth Boutique, an investment adviser registered with the States of New Jersey, Alabama, Ohio, Colorado, Indiana, South Carolina, Virginia, and Michigan.
This content was generated with AI assistance. While we strive for accuracy, AI may not capture all current laws and market conditions. This information is for informational purposes only and should not be considered personalized financial advice. Always consult a licensed financial advisor for decisions tailored to your unique situation and goals. AI is used to enhance insights, not replace professional guidance.