Should You File For Divorce In a Bad Economy?
Michigan, like most of the nation, is experiencing a tremendous amount of economic uncertainty. Inflation is still high, the UAW continues to be on strike, and layoffs continue at many major employers.
Financial disputes are a leading reason for divorces, and amidst difficult economic times, married couples find themselves under increased pressure. This can lead to arguments or acting out, and can even cause long simmering issues within a marriage to boil over. However, is it wise to file for divorce when the economy is lagging?
Considerations Before Filing For Divorce In Uncertain Economic Times
Filing for divorce is never an easy decision. A divorce impacts every facet of your life. Due to the uncertainty of life, the uncertainty of divorce can be scary for many. Difficult economic circumstances can compound these fears, causing many to remain in a marriage far longer than they want to. There are many things to think about when considering divorce in Michigan. Some of these include:
Your Financial Future
Depending on your marriage, you might be a single-income household or both spouses might be working. For those with one income source, the thought of divorce can be frightening, particularly for the spouse that is not working. It is hard to know if you will be able to support yourself or your children financially. When the economic news is poor, this fear can become exacerbated.
Children are the primary concern of every married couple that has them. A divorce can be particularly difficult on children, both emotionally and intellectually. Parents that are struggling in their marriage often keep these elements of their lives hidden from their children for various reasons. This can make the announcement of a divorce seem sudden and shocking, especially to very young children.
Your home is the center of your life. Many couples have a difficult time deciding what to do with their home after a divorce. Can you afford to live in your current home without your spouse’s income? Will you want to relocate in the future? During uncertain economic times, it may be difficult to sell your house or get what you want for it. These are serious considerations to take into account before filing for divorce.
Should I Wait For The Economy to Improve Before Filing for Divorce in Michigan?
If you are feeling uncertain about your future, one option could be to wait for the economic outlook to improve before filing for divorce. However, this also carries some risks. For example, if your marriage is in trouble, it is more than likely that your spouse is feeling the same way. This could lead them to file before you, which can put you at a disadvantage.
Although in Michigan, it does not have a legal impact, the first party to file for divorce in Michigan can still request different orders and have different processes in motion before their spouse is even aware that a divorce has been filed. From this perspective, waiting for the economy to turn around might be disadvantageous to your divorce case.
The other risk is if you are in an abusive marriage, you run the severe risk of further abuse from your spouse. As difficult as it might be to think about, no economic circumstance is worth suffering physical or emotional abuse for. Plus, the reality is that an economic turnaround can come in 3 months or it can take years. There is no way of knowing how long economic indicators will remain negative.
Could it Be Financially Advantageous to File For Divorce In a Weaker Economy?
There are circumstances where it may even make more sense from a financial standpoint to file for divorce in a tough economy. One example would be the situation where the other spouse would like to keep the marital home and the filing spouse would like to keep their retirement accounts intact. The housing market is currently still relatively strong and the value of property is probably somewhat inflated. At the same time, stocks and other retirement type assets have dropped in value significantly. Typically, the parties would share the value of the equity in the house and divide the retirement account equally through the use of a qualified domestic relations order, but the parties are free to negotiate whatever works best for them and it is fairly common to offset one type of property against another.
So in this scenario, the spouse that wants to keep the retirement account intact (spouse A) could agree that rather than the other spouse (spouse B) refinancing the home to pay out the equity, spouse A could retain most or all of the retirement account in lieu of a cash buyout. In addition, because of the pretax nature of the retirement account, spouse A should receive approximately twenty-five (25%) percent more stock than spouse A would have received in equity. This means that if Spouse A would have received $100,000 in equity, spouse A is entitled to $125,000 in retirement account funds, which also allows spouse A to retain a greater percent of the retirement funds. Finally, the costs of sale are not included when calculating the equity of the home in a divorce case, so spouse B will eventually bear all of the costs of the sale of the home which is a further advantage to spouse A. So if one knows that their spouse really wants to keep the marital home, then now would be a very good time to file for divorce before the real estate market drops further.
- Can You Still File a Joint Tax Return If You File For Divorce Before The End Of The Year?
- Filing Divorce During The Holidays: Good or Bad Idea?
- How To Enjoy The Holidays Without Adding To Your Debt
- Tips For Handling Child Custody During The Holidays
- High Net Worth Divorce In Wayne County
- Enforcing Child Support In Michigan
- Chapter 7 Bankruptcy Denial
- Should You File For Divorce In a Bad Economy?
- How To Handle Child Support While On Strike
- Common Injuries In Michigan Car Accidents