Giving The Option To Choose Is Always A Good Thing
Ask anyone who has gone through the college acceptance period of their life… having the option to choose which college they were going to attend was always a luxury to strive for. The same holds true when settling on an equitable distribution in a divorce.
Aside from trying to avoid going to trial, which 94% of divorcing couples manage to do, couples should strive to create a number of scenarios from which they can choose from so both parties walk away feeling somewhat satisfied. What may be important to one party, may have no value to the other so it is important to divide the assets such that each party has as much of what is important to them as possible.
Creating these scenarios and seeing the respective graphs & charts, giving a visual of each party’s financial health, often diminishes the fears of the unknown. It also protects those who state that they only want the marital home, forgoing any liquid and investable assets, from setting themselves up for the financial challenges of being house poor and possibly not having enough to ever retire.
Be aware… some assets are not what they seem. For instance, monies held in a retirement account should not be distributed dollar for dollar unless there is no need to liquidate it until retirement. There are costly tax consequences, often including additional penalties, for retirement accounts that are liquidated prematurely. Also, liquidating assets that have enjoyed a large capital gain will also cost you at tax time. It is important to decipher which investments will carry along higher tax consequences.
Smart and effective practices…Let Money At Work help you organize and prepare for your financial health and let your lawyers focus on what they do best. For more information, please contact Ed Metz, CDFA, at (973)895-1133 or visit www.MoneyAtWorkLLC.com.