One of the scariest aspects of going through a divorce is the feeling of financial uncertainty. For those expecting to pay or collect support, there are questions about when things will kick in and how much money will be involved. Even if support isn't part of the equation, the question of who gets what matters. Likewise, debt can be scary to deal with in this context both in terms of existing obligations and trying to get access to credit.
Some of the biggest missteps you can make during a divorce are financial ones. Before you make any money moves, it's a good idea to discuss the implications with a divorce attorney, like those at Bray & Johnson Law Firm. Take a look at some of the concerns you may want to mention to your lawyer.
Child and Spousal Support
The majority of states employ a system where an income-share formula is applied to paying child support. Child support is paid as a percentage of the income each parent had during the marriage. Some states use a percentage of the income of the noncustodial parent, and a few use a modified version of income shares.
Spousal support, sometimes called alimony, is awarded to the former partner who makes less money. The court looks at spousal support separately from child support. Usually, you have to be married for a minimum amount of time to be entitled to spousal support. It then lasts based on how long the marriage lasted, although some states offer permanent spousal support.
Dividing Up Assets and Liabilities
Both assets and liabilities have to be divided up during a divorce. Community property refers to anything obtained as a couple during the marriage, such as joint checking accounts, a house and vehicles. Most debts incurred during a marriage are also considered part of this pool.
Separate property largely covers things that were purchased before the marriage. If you owned your house before getting married, for example, it is separate property. Personal injury awards, gifts, and inheritances are usually considered separate property even if they were granted during the marriage.
Getting Credit During Divorce
If possible, try to avoid seeking new credit while getting divorced until a permanent court order has been entered. Any collateral that comes out of the community property pool may be seen as fraudulent. Likewise, collateralizing property your ex gave you outside a court order could open it up to seizure if your ex defaults on a loan or declares bankruptcy.