A divorce may include major adjustments to household finances

On Behalf of | Sep 27, 2021 | Divorce

Individuals in households with more than one income may find it difficult to transition to a single earner’s budget. A basic financial evaluation may help to divide assets in a way that provides a reasonable divorce settlement.

As noted by Kiplinger’s Personal Finance, asset division requires a 50-50 split in Texas. Under the Lone Star State’s community property laws, each spouse has a right to receive half of the funds held in a couple’s joint accounts.

Preparing for shared account division

Many financial institutions require permission from both account owners when an account closes. One spouse may find it difficult to withdraw all of the funds from an account. If successful, a divorce court may order the individual to provide half of the funds to his or her soon-to-be ex-spouse. During a divorce, however, a spouse may withdraw half of the funds.

A divorce also requires dividing shared debts in half. Applying for a new credit card as a single individual may do more than help establish personal credit after the divorce. It may also make it easy to transfer half of the balance owed on a shared credit card.

Requesting financial support from an ex-spouse

As reported by CNBC, researchers determined that divorce affects women’s finances more than men’s. Because of gaps in wages and leaving work to raise children, women trail behind male earners and may require financial support from a soon-to-be ex-spouse. Based on how much each spouse earns and who takes custody of children, a court may award financial support.

Lifestyle changes such as a divorce require reviewing a budget. While assets generally divide equally in Texas, an individual who needs financial support may request it from the court. In some cases, however, an award may only cover expenses for a limited time.

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