Main Menu Practice Areas
Barbara L. Jouette, Attorney, P.C.
888-268-7997 / 214-385-4562

Mistakes to avoid in during divorce.

Texas residents may be interested to learn that the number of couples getting divorces after the age of 50 has increased compared to 1960. Experts say that in this age group, divorcing couples may be leaving too much money unnoticed when it comes to retirement accounts.

Because many of these couples are close to retirement, failing to divide seek a share of the other party's retirement account may drastically affect an individual's financial future. Such accounts often accumulate large sums that offer protection from certain taxes and might provide a stable foundation for life after the marriage ends. However, recent survey showed that approximately one third of divorcing parties left a good portion of retirement income untouched after the property division had ended, and many individuals did not know that they were entitled to a share of the accounts.

When negotiating during property division, there are a few missteps that many individuals might want to avoid. According to a recent article, many people fight for ownership of the family home, but a share of a retirement account might be a more stable and valuable asset because property values are not as predictable. In addition, withdrawing funds from the share of the IRAs and 401(k)s awarded after divorce might expose the asset to large tax penalties, reducing the asset's value and usefulness.

When approaching a divorce, retaining the services of professionals might help a person avoid these missteps. In addition to working with a financial planner, individuals might also work with a lawyer who is familiar with family law. That lawyer might help a client understand his or her rights and obligations during the asset division process and could work to protect a client's individual assets from division.

Source: Forbes, "The Big Money Mistake Divorcing Women Make", Kerry Hannon , July 03, 2014

No Comments

Leave a comment
Comment Information