Financial mistakes during divorce can be detrimental

 Posted on February 11, 2016 in High Asset Divorce

Divorce can understandably be financially complicated, which is why it is not uncommon for people to make serious errors during this type of family law proceeding. Unfortunately, these errors can be costly down the road. A few tips may help people avoid making detrimental mistakes during a divorce in Illinois.

One of the biggest mistakes that divorcing individuals make is that they do not understand how taxes will impact their settlements. Taxes have an effect on the value of any property one receives as well as on the quantity of support one will get or pay. Knowing a settlement's tax implications may help one avoid being surprised by a huge tax bill following a divorce.

Another mistake people make during divorce is that they fail to think long term. It is paramount that people negotiate support agreements that will enable them to live comfortably following their divorces. People would also be wise to plan financially for the period when support ends up running out. It is expedient to know how long one will receive or pay support, whether this amount can be modified and whether or not it will be extended at some point for any reason.

If two people in Illinois are able to see eye to eye during the divorce process, they may benefit from mediating the divorce rather than litigating it. Through divorce mediation, two people can work toward a divorce settlement that satisfies them both. However, if they cannot agree on how to divide their assets and property or tackle other divorce-related issues, a divorce court judge will have to ultimately make these important decisions for them.

Source: The Huffington Post, "10 Financial Mistakes to Avoid in Divorce", Karen Covy, Feb. 8, 2016