One of the best ways to alleviate some of the stressors that come with divorce is to find a reputable Las Cruces divorce lawyer. You can also be proactive, informed, and fully participatory in the divorce process. This is especially true when considering how divorce affects you financially.
Whether or not you were proactive about finances in your marriage, your divorce is an opportunity to be strategic and future-oriented about money. Your lawyer can help you think through each of these.
Planning Your Divorce Settlement Budget
Once you divorce, you operate on a single income. If you didn’t work during your marriage, divorce can be especially terrifying. To prepare, start planning a budget now. Write down all of your income streams and your monthly expenses (such as groceries, utilities, rent/mortgage, gas, childcare expenses, etc.). Use this information to create a reasonable budget.
You may also find it helpful to set some financial goals if you need a new home or a new car, or to establish separate savings from your former partner.
Become more familiar with your personal assets and liabilities. Being well-informed about your income, responsibilities, and expenses will help you avoid any nasty surprises. It will also prepare you for conversations about alimony and child support.
Taking Care of Kids During a Divorce
Take a moment to assess what financial planning you and your spouse have done on behalf of your children. Did you start a college savings account for each child? Have you agreed upon what costs you and your spouse, as the parents, will cover for your children as they grow up and start to become independent?
Child support will almost definitely be a court-ordered requirement for either yourself or your spouse. It is not tax-deductible for the person who receives it, but is tax-deductible for the person paying child support.
Be aware that filing for bankruptcy does not eliminate child support debt and you’ll still be legally obligated for future payments.
Who Pays Alimony in a Divorce?
Typically, the higher-income earning spouse is responsible for spousal support payments. Alimony is paid in addition to child support and is considered income. The spouse contributing may be able to deduct the alimony contribution to their traditional IRA, depending on the contribution and tax situation of the contributing spouse.
In New Mexico, if a valid prenuptial or post-nuptial agreement dictates the terms of alimony, the court will typically uphold it. If you request alimony you will have to prove you need it and that your partner can afford to pay it. This is where having a reasonable assessment of your income and expenses will come in handy.
The court will determine whether alimony should be awarded. If so, the court also decides how much the payments are and how long they will last. The court can also determine whether spousal support is modifiable in the future.
Social Security Claims and Divorce
If you were married to your spouse for more than ten years, you have the ability to claim spousal benefits. Getting information on Social Security benefits is easy—just call or visit an SSA office. They can give you an estimate on the benefits you may receive as a divorced spouse. You don’t need your former partner’s permission or approval to collect these benefits.
Something you may not know is that if you do marry again, you will lose the ability to claim those spousal benefits. You may also want to consider whether your own benefits are more beneficial to you than spousal benefits. This is the type of decision-making a qualified divorce attorney can help with.
Protecting Your Assets After a Divorce
You need to rewrite your will and/or estate plan if the original was written with your ex-spouse.
Start with a review of your existing will along with any other directives. In particular, review named beneficiaries on all legal documents. You will want to name new beneficiaries in sections where your ex-spouse is currently named. Some items to review are life insurance policies, IRAs, and 401(k)s.
New Mexico is a community property state, so your ex is likely entitled to half your retirement savings. Make sure to go over any and all assets with your lawyer.
At Sutherland Law Firm, we can advise you in each of these areas of financially planning for divorce. We help you with writing wills, estate planning, and creating trusts for your family at every stage. Contact us today for legal advice when going over your documents either in preparation for, or after, a divorce.
Do you need a will, estate plan, or trust made for your family? Or, do you need legal advice going over your documents after a divorce? If so, contact us. Our Las Cruces divorce lawyer can help you with anything you may need.