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Financial challenges for women after divorce

California residents whose marriages are ending may have a lower standard of living after the divorce. Often, this happens to women because they still make less than men do at around 82 cents to the dollar. The gap is even greater in certain fields or with other variables. There are a number of reasons for this including the likelihood that caregiving duties will fall to women, and this means they may work part time, have less chance for career advancement and save less money.

It is important for the person in a divorce who has made less money to prepare financially. Knowledge is one part of these preparations. A person who is largely unacquainted with the family finances might want to take a class or consult a professional to better understand how to plan a budget and set financial goals. The person will need to consider expenses, income, assets and goals in making a financial plan for after the divorce.

The family home in a divorce

California residents who are getting a divorce may want to refinance the family home in order to keep it or get a new mortgage. They should think about a number of financial factors including whether it is possible to buy out the other spouse, whether alimony and child support are being paid or received, and whether there is enough money for a down payment.

People who are divorced may face additional challenges when it comes to getting a mortgage. Their credit rating may be damaged during the divorce if they fall behind on bills. Furthermore, some forms of income may only be counted by lenders if they have continued for a certain amount of time. For example, most lenders will expect several months of alimony payments before counting it as income. Bonuses, commission-based income and part-time income may all be required to appear on two years of tax returns.

Life changes and child support modification

A California parent who has gone through a divorce and who has been ordered to pay child support may seek a modification for a number of reasons. An injury, losing a job, a change in household income or a change in marital status could all be reasons that result in the need for child support modification. It is important for a parent who needs a modification in child support to avoid procrastinating. Child support modifications are rarely retroactive, and back child support payments cannot be discharged in bankruptcy.

A parent might want to seek legal advice to find out what constitutes a situation that would allow for a child support modification. If the other parent agrees, this could make the process easier since it means litigation will not be necessary. Parents who are not in agreement may be able to reach one using mediation.

Divorce and 401(k)s

Employee retirement plans like 401(k) plans are usually not co-owned with a spouse. However, couples in California who are planning to get a divorce should understand how a 401(k) can be treated when a marriage ends.

Under certain conditions, the retirement account can be split between the two divorcing parties, even if the 401(k) was opened before the marriage began. The Internal Revenue Code and the Employee Retirement Income Security Act of 1974 dictate which requirements will have to be met.

Rules for claiming alimony payments as tax deductions

California residents who pay alimony should be aware of the rules for deducting support payments from taxes. For example, a U.S. Tax Court ruled that alimony payments cannot be claimed as deductions if they are not included in the original divorce or separation agreement. In addition, alimony is not deductible if the parties live in the same household or have a separation agreement specifying that the support payment is not taxable in some way.

The decision on including alimony in the divorce or separation agreement came after a man who divorced in 2007 claimed a bonus he split with his wife as an alimony deduction. The man earned the bonus in 2006 and filed for divorce in 2007. After filing but before the divorce was finalized, the man and his wife signed an agreement regarding the bonus. A later spousal support order included terms for temporary support, but it did not mention the bonus.

Financially preparing for a divorce

California residents who are considering getting a divorce might be concerned about how to prepare financially before starting the process and how to plan for the post-divorce future. While settling financial issues can be a delicate process, with proper planning ahead of time, it can be managed.

Financial planning should begin as soon as couples realize they are headed for this type of separation. They should begin tracking finances, including costs for holiday, repairs, and other big expenses, as well as the day-to-day bills and expenses. This information can be used by both lawyers during settlement negotiations and by a judge to later determine such things as child support.

Couples divorces over political disagreements

According to research, couples in California and across the nation are getting divorced or breaking up over politics. The data showed that about 10 percent of all couples were getting divorced or otherwise ending their relationship due to arguments centered around politics, particularly around the topic of President Trump.

Although breaking up over finances is still a common occurrence, there is evidence to suggest that, within the last six months, politics have become another sticking point for many married and unmarried couples. The survey, which was conducted by Wakefield Research, involved 1,000 participants. Based on the responses, researchers found that about 24 percent of Americans who were in a relationship or were married found themselves disagreeing with their partner or spouse more than ever when the topic of politics came up. Further, 22 percent of the participants personally knew a couple whose marriage or relationship suffered due to disagreements surrounding politics.

How to limit exposure to debt in a marriage

California residents who are married or planning to do so may benefit from a prenuptial or postnuptial agreement. In some cases, it may limit an individual's liability when it comes to paying a spouse's debt. A prenuptial can be worded to specify that premarital debt belongs to the person who accrued it and that it is separate property during the marriage.

Prenuptial agreements are created prior to the marriage becoming official, and they are recognized in all 50 states. While a postnuptial agreement may not be recognized in all states, it may provide full or partial protection to those who are party to one. The main benefit of a postnuptial agreement is that it may indemnify an individual against financial harm caused by debt accrued by a spouse. As the name implies, such agreements are signed after a couple gets married.

How parents can make summer vacation easier

As children in California get older, they are less and less likely to want to spend their summer vacations with their divorced parents. While this is perfectly normal, it is important that non-custodial parents learn to create living conditions that acknowledge this reality. It may be a good idea for parents to integrate their children into the household by asking them to do chores or otherwise contribute to running it.

Parents are urged to let their children know that they are allowed to make contact with their friends and other family members during the summer. In most cases, teen or tween children may resent feeling isolated from those who they may spend the rest of the year with. A parent could address this by arranging to visit with grandparents or other extended family members during a summer stay.

Dealing with requests for back child support

When California custodial parents are seeking child support payments, they may want to request retroactive support. They may need to provide evidence that support was not paid and that they attempted to collect it. If the other parent is the child's father, it may also be necessary to prove the father's paternity.

The court may not grant the request. The other parent will have the opportunity to respond, and they may provide receipts showing that they paid support or provided it in other ways, such as by purchasing food and clothing. If there are no receipts, the parent might have records of communication or a witness who can confirm support. Even non-monetary support such as child care might be considered toward support if the parent is unable to contribute financially.

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