Palmer Rodak & Associates
Palmer Rodak & Associates
Certified Family Law Specialists State Bar of California Board of Legal SpecializationServing your Community for 19 Years
Parle Français • Habla Español • Farsi • ASL
View Our Practice Areas
In this Section

What financial mistakes are common in divorce?

With family vacations over and children settling back in school, many couples across California are filing for divorce. In what has been dubbed by some as divorce season, the back to school period routinely sees an uptick in couples choosing to break up. If you and your spouse find yourselves in this position, there are some financial missteps you should avoid.

According to CNBC, the handling of the family home in a divorce can have a huge impact on your financial outlook. Many want to keep the home for many reasons including consistency and stability for the children or holding onto happy memories, but it is imperative to do so only if it makes financial sense. While a home has value, there are also costs associated with its maintenance, which means that when assets are being divided up, an investment valued at the same amount as the family home on paper is likely worth more in reality. Keeping the house may also not be possible if you cannot afford the mortgage payments and costs of general upkeep.

Retirement savings are another hotspot for financial mistakes in divorce. The savings in a 401(k) account operate under their own rules, and unless you understand them you could end up with a hefty tax bill--early withdrawals from these accounts come with a 10 percent tax penalty. This penalty can be avoided by getting a court order, also known as a qualified domestic relations order, to be able to take the money without the extra tax, but unless you roll it into your own retirement account within 60 days you will have to pay income tax on whatever is withdrawn.

No Comments

Leave a comment
Comment Information
Email Us For A Response

Contact Experienced Attorneys You Can Trust

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Palmer Rodak & Associates
Certified Family Law Specialists State Bar of California Board of Legal Specialization

Del Mar Office
445 Marine View Ave Ste 300
Del Mar, CA 92014

Phone: 858-356-4568
Del Mar Law Office Map

Oceanside Office
301 Mission Avenue Suite 205
Oceanside, CA 92054

Phone: 760-712-3889
Oceanside Law Office Map

Make a Payment