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Financial concerns for divorcing couples

Maryland couples who are divorcing may be unaware of all the financial ramifications of their split. A divorce can lead to significant expenses including the cost of an attorney and increased expenses in terms of paying more in utilities or rent on top of a mortgage. An individual's entire financial picture may change including the amount it is possible to set aside for savings.

It is important for couples to understand their complete financial situation if a divorce seems likely. This means going over income, debt and possessions for both spouses. It is also necessary to identify which assets are shared marital property. One spouse may have to pay child support or alimony to the other.

Owning a business or a home together may mean tax implications and considerations like equity. It may be necessary to split retirement accounts, and if this is done as a lump sum distribution, a large tax bill may result. Therefore, individuals might need to see a financial planner or tax adviser during a divorce. It is also important to remember that beneficiary designations for life insurance and other policies must be changed to remove the ex-spouse's name if so desired.

Divorce can be emotionally trying and overwhelming, and a person who is going through one may wish to consult an attorney even if it appears it will be amicable. People may make poor decisions due to the emotional upheaval. For example, an individual might undervalue a retirement account or a house and allow more assets to go to theoterh spouse due to feeling guilty about the divorce. An attorney may be able to offer a neutral but informed opinion that can help to protect the client during this time.

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