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Divorce survey reports regrets over lack of financial knowledge

| Jan 20, 2020 | Divorce

Indiana couples who are planning on getting married might want to consider getting a prenuptial agreement. A prenup can help protect people financially in case of divorce, and in the course of creating one, couples must communicate about money. It is important for both people in a marriage to be knowledgeable about their financial situation. According to a survey by Fidelity Investments, people who took the longest time to recover financially from a divorce were those who were not involved in the family finances.

While a prenup can offer strong protection, it is not a guarantee, particularly since many people will acquire more assets after the marriage that they might want to keep separate. Examples might include money from a business sale or an inheritance. If these are mingled with the marital finances, they could be considered joint property. A post-nuptial agreement could specify what will happen to property acquired after the marriage.

In the Fidelity survey, 10% of people said they discovered hidden assets in the course of the divorce, and 14% said they found out about debts that they had been unaware of. Most people said they had some involvement in day-to-day finances, but just 60% of women said they participated in long-term financial planning. Communication about and familiarity with both short and long-term finances is important.

If both people have a good grasp of the family finances, the process of property division may proceed with less difficulty. Couples have the opportunity to negotiate their own settlement agreement with the help of their respective attorneys instead of going to court. Working with an attorney may help individuals who might otherwise be swayed by their emotions. Some people may be tempted to agree to unfavorable terms to get the divorce over with, but is important for people to reach an agreement that protects them financially.