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With proper guidance financial impact of divorce can be limited

Ending a marriage does not only take a significant emotional toll on both parties, but it is also financially taxing. Just the thought that the same amount of income will have to provide for two households after the separation is enough to cause elevated stress levels. Then comes the division of property and debts to further complicate the process. The trick is not to try and navigate a divorce in California without experienced legal counsel who can help to prevent the total derailment of retirement plans and college savings for the children.

Things on which a person might want to keep an eye as the divorce proceeds include the type of assets he or she acquires as part of the divorce settlement. A split might seem equal, but the spouse who ends up with liquid assets that will be tough to sell might soon experience cash flow problems. An adviser's help can be valuable in determining the tax status when it comes to choices about brokerage accounts and tax-deferred retirement accounts.

Taxation on continuing income is another matter. There may be questions about alimony and child support and the preparation of post-divorce tax returns. Couples who can keep their divorce amicable are at an advantage, because they may settle for mediation which is much more cost effective and less time consuming than litigated divorces.

While a mediator can encourage communication and guide a couple toward a settlement agreement, he or she may not provide legal advice. For that reason, each party in the divorce will be well served by an experienced family law attorney. A lawyer can provide legal advice and valuable input, and he or she can also be present during mediation to ensure fairness and legality of the final agreement.

Source: TIME, "Keep a Divorce From Killing Your Finances", Jill Schlesinger, Accessed on Aug. 22, 2017

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