The Top Common (But Costly) Financial Mistakes to Avoid During Divorce
Dec 11, 2018
For many people, divorce is time consuming and emotionally draining, which explains why some are tempted to make some considerable financial mistakes during the process. While this is understandable, we as attorneys practice in divorce and family law frequently have to address some of the financial fallout from this decision-making, which then makes the entire process that much more difficult.
Below, we discuss how to avoid making the most damaging financial mistakes while going through divorce:
First and foremost, do not let yourself go out and buy a big ticket item, like a new car or house. While these items might have been financially feasible before, you may very well find that they significantly interfere with your ability to stay on top of new finances that you are now solely responsible for.
Also be careful about cashing in on investments and 401(k)s to pay the bills. Keep in mind that “cashing out” on these items could lead to substantial tax consequences; even potentially placing you in a higher tax bracket for the entire year, which can affect other payments, such as student loan payments. Also, even if you cash in on 401(k) funds that have already been taxed, you can get hit with a penalty by the IRS for cashing in on those funds before you turn 59 ½.
Posted in Divorce · By HD Law Partners






