What Are Some Financial Ramifications Of Divorce?
While divorce offers a fresh start, it usually causes significant strain on many aspects of day-to-day life, including the management and state of your finances. If you are in the midst of planning for a divorce, it’s important to prepare yourself for all possible effects it could have on your income and financial state.
When preparing for divorce, we advise considering the following potential financial factors:
- Marital assets and liabilities: Before meeting with a family law attorney, we advise our clients to make a list of potential marital and non-marital assets and liabilities as these will be split among both parties.
Marital Assets may include:
- Bank accounts
- Tax refunds
- Collectibles, antiques, artwork, jewelry
- Loans owed to you
- Stock, stock options, bonds, mutual funds
- As a general rule, anything of value acquired or improved during the marriage
Non-marital Assets may include:
- An inheritance from a 3rd party (to you individually)
- Gifts from a 3rd party
- As a general rule, anything owned before the marriage and not transmuted into marital property during the course of marriage
Marital Liabilities may include:
- Credit card accounts
- Lines of Credit
- Potential tax liabilities
As you create this detailed list, try to determine the corresponding value for each asset and liability. It may be wise to invest in the help of your accountant to help assess the true worth of each value. If you have copies or have access to copies of your tax returns, please compile the previous three to five years for your attorney to review.
- Child Support: Unfortunately, children can often take the brunt of the effects of divorce. Child support is designed to ensure that your children still receive the adequate amount of care post-divorce. The Department of Social Services offers guidelines to determine the amount to be paid.
The amount is determined by some of the following considerations:**
- Custody arrangements
- Parent income
- Alimony (also referred to as “Spousal Support”)
- Number of children in the home
- Health insurance
- Work related child-care costs
- Extraordinary medical expenses
“Our goal is to create a system where children can count on their parents for the financial and emotional support they need to be healthy and successful.” –South Carolina Department of Social Services.***
- Guardian ad Litem: In contested custody cases, private guardians ad litem are court ordered in order to get a better understanding of the child’s well-being and family dynamics. They are to represent the “best interests” of the child/children involved in the case. These professionals are to be paid by the parents/legal guardians of the child/children.
- Spousal Support: Spousal support is a maintenance payment paid to a spouse whose income will significantly decrease post-divorce.
This is not a comprehensive list of all potential fees associated with divorce, but it serves to provide divorcees an idea of some of the potential costs to expect during/as a result of divorce. To learn more about financial and personal effects of divorce, call us today at 864-523-7738 for a comprehensive consultation with one of our professional and experienced Family Law attorneys or contact us online.