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Divorce process has long-term financial implications

On Behalf of | Aug 15, 2019 | Divorce

Going through a marital breakup in New Jersey can understandably pose emotional challenges. However, it can have a drastic impact on a person’s financial situation as well. Fortunately, a few moves may help individuals who are getting a divorce to protect themselves financially in the years following the divorce proceeding.

For starters, it is imperative that those navigating divorce pay attention to how their asset division decisions will affect them tax-wise. New Jersey is an equitable distribution state, so all marital property — assets accumulated over the course of the marriage — must be divided in a manner that the judge deems equitable, or fair. However, various assets receive different types of tax treatment; for instance, some retirement accounts are pre-tax, while others are not. Understanding how different assets are treated tax-wise may help divorcing individuals to approach property division prudently.

In addition, it is wise to weigh the pros and cons of holding onto the family home after divorce. Some divorcing spouses prefer to keep the home due to the positive memories they have there. However, they may find it difficult to keep up the home on one salary versus two incomes. In this situation, it may be better to simply sell the home and split the proceeds with the other party.

Divorce is a complex process no matter how many assets or few assets two spouses have to split. Fortunately, an attorney can provide the guidance needed to understand the ins and outs of asset distribution in New Jersey. The attorney will help a divorcing spouse to pursue his or her fair share of assets either outside of court or at divorce trial, depending on the circumstances surrounding the divorce proceeding.