Contemplating Divorce? Timing considerations
Many file early in the year
According to many attorneys and based on the number of court filings, divorce is most prevalent at the start of a new year. At first glance, filing for divorce during those first months makes a lot of sense, primarily because most couples may want to stay together during the holidays. This is especially true if there are children in the home. If you waited until after the holidays to file, there are also some financial reasons that you made a good choice. Here are a few of the benefits of early-in-the-year timing.
1. Now you have time to create a great team.
The end of the year can make it difficult to schedule a time to meet with a financial advisor, attorney, CPA, and counselor — especially if you are meeting with several to determine the best fit. With vacations and traveling, it can make sense to wait in order to pick the best team possible.
2. Documentation for credit cards and other holiday spending is rolling in.
During the holiday rush of gift giving, monitoring credit cards and spending is not only difficult but almost impossible. Especially if accounts are held jointly. You need the full complement of statements from the prior year in order to take a look at where your money went to during the holidays. If you suspect that money may have been used for a girlfriend/boyfriend, use the statements to document those expenses.
3. Income and tax documents are accessible.
End of the year payroll statements, W-2s and end of the year investment account information generally will be mailed out at the beginning of the year. Waiting to have the most accurate information on hand is often preferable to relying on a spouse to provide accurate information. Having up-to-date documentation also gives you time to meet with a professional to discuss how you will handle the upcoming tax season. And that leads to the fourth reason.
4. You’re able to gather more information.
If you haven’t been the one primarily responsible for household finances, waiting gives you time to collect what you may need. This may include locating insurance policies, retirement statements, and other asset information — having time after the holidays to get you organized and in a proactive mode can be incredibly beneficial once divorce proceedings begin. You can also pull together a budget to see what your living expenses look like now, may look like in the future and how they will be impacted once you file.
Divorce is rarely easy and ending a relationship has many moving parts. However, with the right information, you can make the best decisions for yourself as you move forward into a new life.
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.
About the author: Michelle Cortes-Harkins, MSW, CRPCA is Wealth Management Advisor at Harkins Wealth Management, LLC. She is based in Providence, Rhode Island.