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Divorce and your personal finances: How to prevent a split from your spouse being a spilt from your financial peace of mind

Divorce is complex. There are deeply personal components to divorce which make the process heart wrenching. You are separating, legally and figuratively, from your life partner and the stability which marriage can instill in our lives. All of the equity that you have built up in that relationship with that person is going to be destroyed in a matter of months. The toughest part is that one of you is asking the State of Texas to make it so.

On the other hand you have the practical/financial components to divorce. You will no longer be living with your spouse so you need to ask yourself where you are going to live. Should you stay in the home? Can you afford to stay in the home without your spouse’s income? You’ve worked hard throughout your life to save up for retirement- one that you assumed would include your spouse. Now that you are getting a divorce you may be thinking about where all the retirement savings are going to go. Will you have anything to show for your years of frugality and planning once your divorce is done?

Learning is the most important thing you can do for yourself before a divorce

I imagine that some attorneys would tell you that the best thing to do when you find yourself in a vulnerable position is to go on the offensive and fight back. To some degree this is true, but not before you take the necessary steps to learn as much as you can about divorce in Texas and the implications of all of the circumstances of your particular case on the processes and laws surrounding divorce in our state.

Understanding the law and how your case is likely to fit within the confines of the law allows you to operate with a level of confidence that you could not possess otherwise. If you are confident in the facts of your case you can be confident in making decisions, and yes, in advocating for yourself and your rights.

Divorce is complex- I think you may have read that at some point in your life (maybe just a few paragraphs earlier). That doesn’t mean that you need to understand and know every single issue when it comes to a divorce in Texas. You don’t even need to know everything there is to know about your spouse. What you need to know are basic concepts and likely outcomes based on your case. Having an experienced family law attorney by your side to assist you during this process is one of the most important aspects of divorce.

Today’s blog post from the Law Office of Bryan Fagan, PLLC will introduce the topic of financial planning in anticipation of divorce. Specifically- the steps that you can take on your own before you even hire an attorney to prepare, what property is subject to division in a Texas divorce and how it is likely to be divided up is also relevant and will be discussed. While there is no surefire way to ensure that no missteps or errors in judgment will be made in your case, thoughtful planning and constant learning are essential to minimizing wrong turns.

Where will my/their/our property end up at the conclusion of the divorce?

Maybe the most frequently asked question when it comes to the personal finances of potential clients of the Law Office of Bryan Fagan, PLLC is where will the person’s property end up once the divorce is all said and done. Will they be able to keep their retirement account? Will it be divided? What about the retirement savings of their spouse? How will that be divided (if at all)? These are all valid questions to ask, of course. You want to know the ending to the story and eliminate any fears or concerns about how to get to that end point.

Unfortunately I cannot tell you (nor can any attorney, for that matter) exactly how your divorce is going to end up. There are just too many circumstances and factors that will weigh on your divorce that nobody can predict with 100% accuracy. With that said, we can provide you with some additional information that can help guide you in the right direction.

For instance, if your divorce will be uncontested your property and that of your spouse may be able to be divided up by the two of you with no intervention from the court. This means that there can be no outstanding issues when it comes to property division. Questions about how to classify property as wither community property or separate property needs to have been answered by this stage. If you and your spouse have children you can have disputes as to the kids and end up in a trial, but if you have settled all issues related to property then much of the financial planning in your case is done on an uncontested basis.

Contested Divorces

However, if you and your spouse cannot come to an agreement on how to divide your property then a court may have to insert itself into your situation in order to solve the dispute. Let’s break down how property is classified in Texas and the effects of this on your divorce case.

Community property is all property that you and your spouse acquired during the course of your marriage. Exceptions to this rule are for property that you inherited from deceased relatives or property that you owned prior to your marriage. In Texas there is a presumption that all property owned by two spouses is considered to be community property so you should be prepared to prove to a judge that a piece of property is your separate property in the event that is a disputed fact in your divorce case.

Speak to your family law attorney prior to negotiating on this subject so that you can prepare a gameplan as to how you see the property in your marriage being divided up. If you need to organize your paperwork to show title in your name only for a home, boat or other piece of property you ought to do so, as well.

Just and Right division of marital property

The State of Texas will attempt to arrive at an equitable (fair) division of whatever property is ultimately deemed as community property. This means that the circumstances of your case will be evaluated in order to determine what is the best way to divide property that both you and your spouse have a claim to. The degree to which your employment earnings contributed to the purchase of the specific item as well as the future needs of each spouse will be determined by your judge.

Create a checklist to determine what is relevant in your life

No two divorces are created equal. Even if your attorney is extremely experienced in family law (which he or she should be if you are hiring them to represent you), they have never seen a case quite like yours. Help your attorney by compiling a list that details what you believe to be the most important issues in your case. Whether it is considerations regarding business interests of either you or your spouse, health insurance concerns, tax questions about divorce or the implications of divorce on your retirement create a list and discuss it with your lawyer. Do not expect your lawyer to have the ability to read your mind about what is important in your case.

More information on the financial components of divorce to be posted tomorrow

If you have any immediate questions about how personal finances impact divorce cases please contact the Law Office of Bryan Fagan, PLLC. We offer free of charge consultations six days a week with a licensed family law provider.

Thank you for taking an interest in the topic of personal finances and divorce. Tomorrow we will discuss the topic of credit and its effect on people like yourself who are going through the divorce process. Being able to utilize credit in intelligent ways is an important factor in making it out of your divorce in a strong financial position.

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