The financial aspect of divorce can be very complicated. Typically, one spouse is more knowledgeable of finances and the couple’s individual financial status. If you are the spouse that is less informed, now is your chance to get caught up.
FULL financial disclosure is key during this part of the mediation process. In order to negotiate and participate meaningfully in the mediation process both spouses must be aware of what you own, what you owe, what was owned previous to the marriage, and what has been acquired since the marriage.
In mediation you and your spouse will have to decide how to divide or distribute all of your assets and debts so that you can achieve a financial divorce. Your assets are your home, retirement accounts, bank accounts, investment accounts, possessions, businesses, insurance policies, cars, etc. Your liabilities will include debts – such as your student loans, credit card debts, car loans, mortgage debt, etc. Before you decide how to divide your assets and debts it is a good idea to consult with your accountant so that you and your spouse are aware of future tax liabilities and other related concerns.
Often couples forget that when it comes to finances, in addition to their finding common ground, they need their creditors (in regard to debts) and the court (in regard to child support) to go along with the plan.
Financial Affidavits. Before your divorce is final you will need to fill out a Family Law Financial Affidavit which will outline the financial details you discussed in mediation. (If you want to see this form prior to mediation, copies can be found on the FL Supreme Court’s website in both PDF and RDF formats – www.flcourts.org. There are two forms, Family Law Financial Affidavit (Short Form) 12.902(b), which should be used when an individual’s gross income is under $50,000 per year and a Family Law Financial Affidavit 12.902(c) which should be used when an individual’s gross income is $50,000 or more per year.
Credit Reports. If you are facing divorce, now is a good time to run a credit report and gather information about your creditors and the status of your debts. Each of us is entitled to a free annual credit report from each of the three nationwide consumer reporting agencies, Equifax, Experian, and TransUnion. It’s important to know if a creditor is calling a debt yours or your spouse’s. You will want to share this information with your mediator and your spouse. Often couples forget that when it comes to debts, in addition to their finding common ground, they need their creditors to go along with the plan. Typically, creditors will not care what has been agreed upon or what the court has ordered in a divorce case, they will pursue the person whose social security number is securing the debt.