The process of getting divorced can do more than take a toll on a person’s emotions in San Antonio. It can also derail the individual’s finances. However, a few steps can help people who are going through divorce to make wise financial decisions now so that they can protect their financial statuses long term.
First, it is important to take into consideration the tax consequences of various assets during the asset division process. Texas is a community property state, so all assets that two people accumulate during their marriage must be split 50/50 when they get divorced. However, the dollars in certain accounts are not equal to the dollars in other accounts. For example, a qualified retirement account has funds that are pre-tax, whereas this is not true for funds in other accounts.
Second, it is important to think hard about the implications of keeping or giving up the family home. If the home’s mortgage has not been paid off yet, refinancing the home in the name of the person who will keep the house is a good idea, as this will ensure that he or she is solely responsible for the debt on the home. The benefit of keeping the home is that a person does not have to go through the hassle of moving elsewhere. The benefit of giving it up, however, is that a divorced spouse will not have to worry about generating enough cash flow to cover the cost of maintaining it on his or her own.
Asset division remains one of the biggest areas of conflict during divorce. It can also be overwhelming due to the many moving parts involved in it. However, an attorney can provide the guidance needed to navigate this aspect of divorce in the most personally favorable manner possible in San Antonio.