Financial mistakes spouses should avoid during a Pennsylvania divorce

Divorcing spouses should beware of common financial missteps, such as overlooking property they may be entitled to or pursuing assets with hidden costs.

Financially surviving divorce is a concern for many spouses in Scranton, given the unavoidable legal costs and the increased living expenses that come after. Sadly, there are several missteps spouses can make during divorce that can greatly raise their risk of experiencing financial strife later. Anyone who is preparing for a divorce should be careful to recognize and avoid the following common financial mistakes.

Misunderstanding state laws

Spouses in Pennsylvania should be familiar with the state laws that will help decide their financial future. Forbes recommends that spouses understand the difference between separate and marital property, along with the process of dividing marital property. Spouses who may be paying or seeking spousal support should also be familiar with state alimony laws. Otherwise, spouses might get caught off guard during the settlement process or fail to seek an appropriate division of assets.

Overlooking marital property

While some divorcing spouses don't understand their legal rights, others fail to pursue property that they might be entitled to because they don't know that it exists. Consequently, The Wall Street Journal advises spouses to spend time becoming familiar with all of their marital assets. Spouses should collect the following documents as early as possible:

  • Statements from bank, investment and retirement accounts
  • Personal and business tax returns
  • Household bills

Spouses should also take an inventory of physical property, including real estate, vehicles, furniture, art and other household possessions.

Forgetting real costs

The Wall Street Journal also notes that spouses should be careful to keep real costs in mind throughout the divorce process. It's important for spouses to be realistic about their future living expenses and financial needs. When dividing marital property, spouses should remember that different assets might carry different tax burdens. Additionally, spouses should factor in any expenses associated with maintaining or liquidating different assets before pursuing those assets.

Keeping the house

Many spouses may attempt to keep the family home for sentimental reasons or to avoid uprooting their children. However, according to The Wall Street Journal, the time and money needed to maintain a house are often too much for one spouse to handle. Furthermore, people who wait until the divorce is complete to sell a house may not recoup the full value attributed to it during the settlement. Instead, spouses may benefit from selling the house together and dividing the proceeds appropriately.

Seeking revenge

Finally, according to USA Today, spouses should try to avoid acting emotionally or using the divorce as an opportunity to seek revenge against the other spouse. This can increase the legal expenses associated with the divorce, setting spouses up for financial stress later. This behavior also can lower the likelihood that spouses will reach an agreeable settlement that adequately addresses the financial needs of both parties.

Avoiding other missteps

In addition to these mistakes, there are countless other pitfalls that can lead to financial distress during or after divorce. To reduce the risk of these missteps, spouses may benefit from consulting with a divorce attorney. An attorney may be able to advise a spouse on common errors and help the spouse pursue a settlement that provides for his or her financial needs.