Top 5 Financial Mistakes In Your Divorce Settlement
There’s little doubt that going through a divorce can be a harrowing experience. Be that as it may, it’s important not to fall victim any of the grievous errors that might make your divorce headache even more worrisome. While there are dozens of potential mistakes out there, let’s concentrate on five of the most important (in no particular order) you’ll want to avoid during your upcoming settlement.
Failing To Update Your Estate Documents
Essential estate documents include things like your Last Will & Testament, Living Will, Advance Medical Directive, and Financial Power of Attorney. These documents might also include your life insurance policies, among other items that have beneficiaries, and estate planning lawyers note that many people forget to update these documents following a divorce.
This means that assets you intended to go to your children, a charity, or a new partner might go to your ex-spouse instead. To avoid this scenario, you’ll want to obtain legal advice for creating a customized estate plan, and be sure to update your documents during/following your divorce.
Getting Emotionally Attached To Assets
During divorce negotiations, it’s important that you remain level headed so that you can make good decisions. Excess emotion can impair your ability to negotiate rationally, and that’s what happens all too often when individuals assign undue emotional value to their assets during a divorce.
From a financial wellness standpoint, there may well be assets that you’d be better off letting go during your divorce. Getting too emotionally attached, however, may cause you to fight for these assets, bringing about a fair share of undue stress and sticking you with a burden you’d be better off without once everything is said and done.
Getting Emotionally Attached To The Divorce
A divorce can summon a number of feelings, but if you let emotion override your better judgment and feel the need to “stick it” to your spouse, you’ll likely find things blowing up in your face. Trying to get revenge through a divorce settlement just ends up costing you more in the long run, so stay rational, negotiate with clarity, and get back to living your life.
Mediation isn’t appropriate for all couples going through divorce, but that doesn’t mean you should just disregard the possibility out of hand. There are benefits to having a neutral third party help sort through your assets, so consider these carefully and try to work together before you have to drop thousands in legal fees to get your divorce resolved. It might help to speak with an expert, like a Folsom divorce mediation attorney, prior to dismissing mediation as a possibility.
Not Planning Your Finances Post-Divorce
Life goes on after a divorce, and failing to plan for your future finances is almost always a costly mistake. You’ll have to transition to both a new way of life and an adjusted income, so be sure to plan for your post-divorce budget well in advance so there are no surprises.