Colorado couples who are divorcing will need to consider how to divide assets. That division will depend upon a number of factors including the debt burden, the present needs of the individuals, retirement, and more. Many people do not realize that when debts are divided, approval by the court of the property division does not necessarily remove the party who is not taking them over from liability. Before the divorce is finalized, individuals need to work with creditors to ensure that debts have been placed in the proper name. Otherwise, even if a court assigns the debt to one individual, if the other spouse's name remains on the obligation, that individual can still be pursued for payment.
Another consideration is the financial situation of each individual. Liquid assets may be desired by those who need more immediate access to ready cash while a better long-term plan is to take a mix of accounts with varied liquidity.
Taxes and retirement accounts are other important considerations. Individuals should take a look at what kinds of accounts are taxable as well as ensuring that they do not incur avoidable tax liabilities. Attorneys and financial planners may be helpful in advising the best course of action regarding these complex topics. Finally, divorcing spouses need to consider digital assets from photos and videos to shared online accounts. These may not have monetary value, but they may carry some emotional weight.
Because divorce is a trying time, individuals may overlook some of the more practical aspects of dividing assets. Therefore, it may be helpful to have legal guidance in order to ensure that individuals receive an appropriate proportion of assets. Balancing short and long-term needs with practical and emotional considerations is the key to a settlement that may be acceptable to both parties.
Source: Forbes, "6 Money Matters Divorcing Spouses Often Overlook", Leslie Thompson, August 19, 2014
Tags: Divorce, property division
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