How to avoid long-term money woes after a divorce

While California residents may experience financial and emotional consequences after a divorce, it is possible to recover from them. According to a survey from Fidelity Investments, it takes about five years for most people to feel as if they have recovered both emotionally and financially from the end of a marriage. Those who played a role overseeing a household’s finances said it was easier to recover from the financial fallout of a divorce.

The same was generally true for those who played a role in crafting a household’s long-term financial plan. Ideally, both parties to a marriage will have a basic understanding of how much a household is worth. Financial information can be gleaned from a tax return or by reviewing bank or other account statements regularly. Couples are encouraged to communicate about money while they are married, and doing so may reduce the chances that a spouse has hidden assets or debts.

Creating a prenuptial agreement can help couples plan for what would happen if their marriage ended. However, a postnuptial agreement may be necessary if couples acquire new assets during a marriage. For instance, a person may inherit money or choose to start a business. Having such an agreement in place may help to avoid commingling assets or otherwise causing disputes over how they should be treated.

Working with an attorney may help individuals learn more about how to divide marital property in a divorce. Individuals might also learn more about how to obtain spousal support or other forms of financial assistance that may be available to them. If a couple has a prenuptial agreement in place, an attorney might review it to determine its validity. Assuming that an agreement is valid, its terms will likely dictate how the final divorce settlement is structured.

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