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How Planning Can Prevent Financial Mistakes in Your DivorceIt is vital to have a financial plan when you are creating a divorce agreement, including your budget for after the divorce and which assets you most need from your marriage. Your income as a single adult will be lower than what you had as a couple, and some expenses will become your sole responsibility to pay for. A smart divorce agreement will help you transition into a more stable financial situation. Conversely, a poorly planned agreement may leave you at a financial disadvantage. Here are three financial mistakes that can hurt you after your divorce:

  1. Overlooking the Cost of Real Estate: Marital homes and other real estate are among the most valuable properties in a divorce, but they are also among the most expensive to keep. Any residence or building that you own comes with property taxes, utility fees, and maintenance costs. Many homeowners are also still paying the mortgage on their house. Your home or other real properties may be worth keeping after your divorce, but you must include the related costs in your budget.
  2. Not Considering Growth Potential: There are multiple ways of calculating the value of marital properties. One way is to consider whether a property has the potential to increase or decrease in value over time. Common examples include businesses, financial investments, and collectibles. You may regret letting your spouse keep these properties based on their current value, only to watch them increase in value in a couple of years. However, there is also risk involved if properties do not increase in value at the projected rate or decrease in value. The marital properties that you keep in your divorce should be a mix of those with growth potential and value certainty.
  3. Taking Short-Term Gain at a Long-Term Cost: Your immediate financial concern during a divorce is how you will support yourself, but you should still consider your long-term financial goals. Your retirement plan is a good example. You can withdraw money from your plan in order to compensate your spouse for letting you keep a valuable marital property. However, you are taking away from the money you need to support yourself later in life and may incur fees or taxes for making an early withdrawal. The long-term value of some assets can be more important to you than the short-term benefits of selling them.

Contact a Barrington, Illinois, Divorce Lawyer

The division of property is more than trying to get the most valuable assets from your marriage. A Barrington, Illinois, divorce attorney at Joseph M. Lucas & Associates, LLC, will make sure you have a strategy when negotiating your agreement. To schedule a consultation, call 847-381-8700.

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Three Questions That Help You Decide on Your Marital HomeIt can be difficult to choose whether you should keep or sell your marital home during a divorce. Keeping a home can be expensive, but selling it would be losing possibly your most valuable asset. To know the right answer to this dilemma, you need to know the right questions. Other aspects of your divorce and your personal life will likely determine whether you should keep your home. Here are three important questions to answer about your marital home:

  1. How Much Would It Cost to Keep the Home?: Keeping your marital home may be impractical if you cannot afford it. Homeowner expenses are more than making mortgage payments. You are also responsible for paying utilities, maintenance, and property taxes. A homeowner tax exemption or spousal maintenance could offset some of the cost. You also must consider what you will be giving up during the divorce in exchange for the home. If your home is the most valuable property from your marriage, your spouse will need to receive assets of similar value. Losing those assets could diminish your ability to afford your home.
  2. How Much Value Would You Receive from Selling the Home?: You should always appraise the value of your marital home as if you were planning to sell it. You need to know your home’s actual value, whether you are selling it or including it in the division of property. Your home’s assessed value will tell you how much money you need to receive in a sale to make selling your home worth it. The housing market and location of your home can affect how much potential buyers are willing to offer for your home. It may be wiser to hold onto your home if you cannot receive acceptable value for it.
  3. Are There Reasons to Keep the Home That Are Not Money-Related?: Finances are not the only consideration when making property decisions during a divorce. Your children may benefit from staying in their family home. You may have a personal history or emotional attachment to the home. Looking for a new home on top of your divorce may be overwhelming. Whatever the reason is, you must weigh whether it is worth the cost of keeping the home.

Contact a Barrington Divorce Lawyer

You should decide whether to keep or sell your home only after you have discussed the consequences of both decisions. A Barrington, Illinois, divorce attorney at Joseph M. Lucas & Associates, LLC, can assess your situation to help you reach a decision. To schedule a consultation, call 847-381-8700.

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Collecting Your Spouse's Social Security After DivorceRetirement benefits are marital assets that can be divided during a divorce. Negotiating the division of these benefits can be contentious because of their high value and the significance they serve later in your life. Obtaining a share of your spouse’s retirement benefits may mean sacrificing other marital properties as equal compensation. However, Social Security benefits work differently than other retirement benefits. You can collect a portion of your former spouse’s Social Security benefits without it affecting the benefits that he or she receives.

How It Works

You can receive as much as half of the value of your former spouse’s Social Security payments, depending on how close you are to the full retirement age. In order to qualify:

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Preventing Your Business from Ending with Your MarriageWhen owning a small business, your personal income and assets can easily overlap with those of your business. Thus, your business must be accounted for during the division of marital property, even if your spouse does not contribute to it. Divorce can have a negative effect on a small business if a reasonable settlement cannot be reached. Your spouse may have a right to a share of your business or to marital properties of equitable value. Any loss of assets or revenue can be the difference between a successful business and one that is no longer profitable. You need to make protecting your business a priority during your divorce.

Business Valuation

Once your divorce has started, the crucial first step is to assess the value of your business. Your spouse is likely to use his or her own assessor, so it is important that you bring in an assessor that can determine an accurate valuation of your business. An assessment will consider:

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Property that is acquired from the date of the marriage through the date of the separation is considered marital property. While there are a few exceptions to this, they aren't present in every situation. A recent case in Cook County shows just how the interpretation of the law can have an impact on how cases are handled.

The case has to do with a settlement that a man received due to being wrongfully incarcerated. He and a woman dated while he was incarcerated. They got married in October of 2000. Throughout the time they were together, the woman fought to prove his innocence.

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