The divorce rate is higher for older adults than it was in the 1990s, and when older couples in Georgia get a divorce, one spouse might not be familiar with the marital finances. In a survey by UBS Global Wealth Management of 2,500 couples and over 600 women who were divorced or widowed with at least $250,000 for investing, more than half of the women said financial planning and major investment decisions were made by their spouse.
When Georgia couples are considering a divorce, there are a number of things that may need to be taken care of. Especially after a long-time marriage, the thought of disentangling from one another can raise a host of practical concerns aside from the emotional impact of the end of a marriage. There are some financial housekeeping measures that spouses can take that can help them be prepared to take their next steps towards independence.
People in Georgia who divorce face a major impact on their finances. Finances are often the most contentious issues in a divorce. Because many married couples have a deeply intertwined financial life, separating all of their debts and assets can be complex. In addition, it is not uncommon for people to feel as if they are being stripped of hard-earned money and property.
Georgia couples going through divorce should be sure to address the division of their retirement accounts in a careful manner. Certain types of retirement accounts, such as 401(k)s, are subject to different rules than other types of pensions. Taking the wrong step when dividing such assets can result in high penalties, a large tax bill and problems regarding fund allocation.
In a Georgia divorce case, it may be necessary to put a price tag on a business for property division purposes. The biggest question when doing so may revolve around whether to do a full valuation or a calculation of value. Regardless of which option is chosen, the calculation should be made by a skilled professional. This is true no matter how the business is structured.
For Georgia couples going through a divorce, financial considerations may be a paramount concern. Ending a marriage can carry with it significant financial consequences, especially in property division and spousal support. A split can have an impact on the financial health of both former spouses at a number of levels. One aspect of divorce which perhaps is considered less frequently is the tax impact.
People seeking a divorce in Georgia might need to mingle retirement planning with their financial decisions about a divorce settlement. A spouse who earned substantially less than a partner should investigate how Social Security benefits will be calculated upon reaching retirement age. People in marriages that last for at least 10 years could gain additional benefits by making a claim upon an ex-spouse's earnings.
Without the proper planning, Georgia residents who are going through divorce may never fully recover financially. However, there are some things they can do to lessen the impact the separation process will have on their financial future.
Georgia residents who are looking to save money on a divorce may be tempted to split retirement assets on their own. However, splitting such an asset without the proper authorization could result in taxes and penalties. In one case, an individual withdrew $250,000 from a 401(k) without getting a qualified domestic relations order (QDRO). That resulted in $85,000 in income taxes in addition to a $25,000 early withdrawal fee.
When a Georgia couple gets married, they may be able to protect their individual finances without a prenuptial agreement. This is not just in case of divorce. The couple gets the opportunity to discuss their debts and assets openly, and their finances can be arranged in a way to protect each from the other's debts.