Unlike most married couples, you and your spouse have separate bank accounts. Now that you and your husband or wife have decided to divorce, you wonder if your unconventional approach to marital finances may speed up your split, allowing you to start the next phase of your life sooner.
CNBC Make It notes that such an approach does not always make the asset division process of divorce easier.
Florida operates under equitable distribution laws. That means that anything you earned during the marriage is yours. That said, there is no guarantee that your spouse cannot convince a judge that all of your assets are marital property. Additionally, a judge may decide to use your separate assets to fund your divorce settlement.
Access to money
This is not to say that having and maintaining separate bank accounts during divorce is without its advantages. One good thing is that your having a separate account gives you quick and easy access to your own funds should you need them during your divorce. Your spouse may decide to limit access to a joint fund, which could make it difficult for you to buy whatever you need to move on with your life.
Additional protective measures
To better protect yourself and your finances during divorce, consider printing out financial statements for the month before you married your spouse. This makes it clear what you brought into the marriage and how to properly divide assets.
Maintaining a separate bank account during your marriage may not offer you the protection you think it may during divorce, but it is not entirely futile.
When you think about the benefits of collaborative divorce, you likely realize the emotional advantages of taking this route. When couples work together to bring their marriage to an end in an amicable manner, it is very possible that they will reduce the emotional toll of the divorce process, which is especially important if you have kids. For example, couples will probably have less stress and some of the hardships associated with litigation (such as threats, grudges, resentment and so on) are likely considerably lower (or nonexistent). However, if you wonder whether the collaborative process is advantageous in terms of time, it is important to examine the benefits of this route in this regard as well.
According to the New York State Unified Court System, many couples find that the collaborative process is more efficient when compared to a typical divorce. First of all, it is imperative to note that every divorce is unique and some are time-consuming regardless of the approach that is taken. However, when couples work together during a collaborative divorce the process is often more straightforward. Moreover, couples often avoid a string of court appointments, which could save you a considerable amount of time.
If you are thinking about a collaborative divorce, you need to assess your own circumstances and determine if this strategy is a smart move. Sometimes, the collaborative process is not an option and many people are unable to have positive or useful communication with their ex.
Dividing your assets during your divorce in Florida is often one of the most difficult processes. You need to come up with valuation for all marital property and reach an agreement that the court will find to be fair and equal. This can take a lot of work, especially if you have difficult assets to divide. Often retirement accounts may pose an issue, but if you have a 401k, you will discover that it actually makes division rather easy.
Forbes explains that a 401k has a daily cash value. This means that you can easily determine the valuation, which is often a tricky part of dividing retirement accounts. You also have the option to divide a 401k in any way that you want without a lot of restrictions.
One of the best things about a 401k is that as a spouse, you can roll over any 401k funds from your spouse to another 401k without any penalties. This can save you a lot on taxes. Another way to avoid taxes but that allows you to take the money out of the account is with a Qualified Domestic Relations Order. A QDRO lets you avoid taxes if you withdraw the money before the age of 59 1/2.
Do note, though, that even withdrawing through the QDRO, you will still have to pay income taxes on the money. You only avoid the tax penalty for an early withdrawal. So, the best option to maximize the money is probably to roll it over into your own account.