Aside from matters involving child custody, the division of marital wealth is the top priority for most Colorado spouses who are going through a divorce. The focus directed at property division is justified, as the outcome of the division of marital assets will have a significant impact on the financial standing of both spouses for many years to come. When working through the various property division options, spouses should take care to consider their long term interests, and not make decisions that are based on stress or in the needs of the moment.
For example, a common mistake that many spouses make during divorce is to insist on retaining the family home. For a parent who will have primary custody of a shared child or children, staying in the family home can feel like an important step in maintaining a sense of stability for the kids. In reality, however, one's home is an asset, and one that should be evaluated objectively.
Unlike investments or cash savings, a home is an asset that cannot be easily liquidated if the need should arise. In addition, homes require maintenance and upkeep, which is an added expense that many other assets are unencumbered with. Determining the value of a home is also problematic, as appraisals are nothing more than an estimation of what a home might sell for at a given point in time. When the time comes to actually sell the property, the price could be far different. In addition, selling a home brings about expenses related to the sale itself, as well as tax obligations.
When considering whether to negotiate to keep the family home, spouses in Colorado and elsewhere should take the time to evaluate whether that property division choice is in line with their long term goals. In certain cases, retaining a family home might be a great investment. For many, however, the uncertainties that come with this particular type of asset make it an unwise financial choice.
Source: unionleader.com, "Money Sense: Financial mistakes to avoid during a divorce settlement", Marc A. Hebert, May 2, 2015