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Fort Lauderdale, Florida, Complex Divorce Blog

Will separate accounts protect your money in divorce?

You'll be walking down the aisle soon in Florida, and all the wedding plans are made. You even have a plan for how to maintain your finances after you're married.

You'll keep your own account, and your spouse will keep one too. There will be no commingling of funds, you decide, just in case you wind up divorcing. You each contribute to a joint household account to pay your living expenses, such as groceries, utilities and housing. What you have left over is yours and yours alone, right?

Alternatives to a litigated divorce

When you decide to divorce, you need professional guidance, but that doesn't necessarily mean you need to hire a lawyer immediately.

You have options, especially if you anticipate your divorce will be friendly and you expect few conflicts. Your first call, instead, could be to a mediator.

How will divorce affect your children?

You may no longer care for your spouse, but you no doubt worry about how splitting up will affect the welfare of your children. You have probably heard conflicting information on the impact of divorce on children. Will they turn out OK, or will they start exhibiting problematic behavior?

Studies give a general idea of the effects divorce has on children. However, you can get a sense of what the reality will be for your own kids based on the following factors.

What you need to know about 'liquidating' in a divorce

Sometimes, when it comes to dividing property and other assets in a divorce, it seems like a going out of business sale, where posters in the storefront blare, "Liquidation! Everything must go!"

You might think it's best to "liquidate" your Florida household - sell everything, split it and start over -- but it really isn't. That could be costly.

Floridians: Guard against these money missteps in a divorce

Divorce isn't easy, especially when it comes to dividing the considerable assets you've worked so hard to accumulate together. When you know you're divorcing, you have to protect those assets harder than ever.

There are a number of financial missteps you can take in a divorce. Here are some to guard against:

  1. The urge to spend. Don't make any big purchases, either, to make you feel better or because you want to spend some money so your spouse doesn't get part of it. You'll want to evaluate your finances after the divorce before buying something like a car, and your spouse also could claim you took money unjustly.
  2. Not considering how alimony affects your taxes. Remember that under the Trump tax plan, you don't get a tax break for paying spousal support.
  3. Selling stocks or taking money out of other investments to pay bills while you wait to finalize the divorce. You could face significant taxes.
  4. Taking money out of your 401(k). If you're under age 59 ½, you'll not only owe taxes on the money, you'll be hit with a penalty. It might seem like a good solution until your settlement is done, but it isn't.
  5. Changing jobs or quitting your job to avoid spousal support. Once you go back to work, you'll wind up in court again to come up with an alimony amount.
  6. Keeping the house if you can't afford it. The person who wants to keep the house will need to buy out the other spouse, and that might not be financially feasible on one income or with just alimony and child support to pay your expenses. Your grand, forever-home just might need to be sold.
  7. Failing to make a financial plan. Going through a divorce is the time to be financially prudent. That includes making a plan that reflects your new financial status.

Strategies needed to avoid trouble in a collaborative divorce

Divorce doesn't have to be a battle between you and your spouse.

In a collaborative divorce, the two of you can work together to end your marriage on relatively friendly terms by sitting together in a conference room instead of a courtroom. While each party still works with an attorney, it's less expensive than litigating your divorce. Moreover, you likely will stay on friendlier terms, which is essential if you have children.

What defines separate property in a divorce?

In Florida, divorce law follows equitable distribution of marriage assets. When dividing property, courts determine what is fair based on specific factors. Most of the time, this results in 50/50 division, but that is not always the case.

One exemption from this process is separate property. There are some assets that are exclusively yours, meaning your former spouse has no claim of ownership. An understanding of what qualifies as separate property will help you during your divorce proceedings.  

Collaborative divorce: The right step for some Florida couples

You're meeting with an attorney to discuss your upcoming divorce and hear a phrase that is new to you: collaborative divorce. The attorney explains it to you and says you and your soon-to-be-ex could be a candidate for this type of divorce, but you want to learn more before making up your mind.

Just what is collaborative divorce?

Is it easier to choose divorce when you're wealthy?

Despite how often people say that "money can't buy happiness," they often act surprised when wealthy individuals still have troubles in their personal lives. For instance, you often see celebrities and other rich couples head to divorce court, and people wonder how it could have happened when they didn't have any financial stress and really had everything -- materialistically speaking -- that they wanted.

What this shows it that divorce really does happen for a lot of reasons. Being wealthy does not mean a couple will be happy, that one spouse will not be unfaithful to the other, or that they won't have some of the same marital issues as less well-to-do couples, like a lack of commitment or communication problems.

2 key considerations for high-asset divorce

Divorce in Fort Lauderdale is never easy to go through, yet many high-value couples do not realize just how much is at stake besides finances and assets. They may have more money and access to resources to help them secure the outcome they want, yet it is not uncommon for them to drop the ball because they want to engage in a full-on war with their partners over unresolved marital issues. 

Not putting looking past marital concerns and negative feelings can make the separation process for wealthy couples more challenging and tedious to resolve because there exist more unique challenges than the average divorce. To better prepare for a high-asset divorce, careful consideration of the following issues is necessary. 

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