When you get married, you merge every aspect of your life with your spouse.
Married couples typically combine bank accounts, buy property together, establish retirement accounts, and accumulate debt.
When you get divorced, you have to divide that property, and debt, in a fair and balanced way. That’s not always easy to do, especially when emotions are high and your financial future is at stake.
If you’re thinking about hiding assets to get a better financial result during your divorce, forget about it.
In California, you have a “fiduciary duty” to your spouse. That means that all financial information must be disclosed voluntarily.
California requires both parties to disclose all assets and liabilities, including income and expenses, as part of the standard divorce filings. The only way to divide property fairly is if both parties disclose everything.
Community vs. Separate Property
After all disclosures have been completed, your property must be “characterized” as either community property or separate property.
California is a community property state. That means that property acquired during the marriage is presumed to be community property unless it can be traced back as separate property.
Generally, separate property remains separate, and community property is divided equally between the two parties. If property is not characterized correctly, it could potentially cost you thousands of dollars.
In order to divide property equally, you must value the property first.
Some items will be easy to value, some will not be so easy.
For example, if you and your spouse disagree on the date of separation, that could have a significant impact on the value of all “marital” savings accounts, investments, retirement accounts, etc.
Even if you hire experts to value specific assets, it’s not unusual for experts to disagree on value.
Split Community Property
After you’ve identified, characterized, and valued all assets and liabilities, the community property must be divided.
Community property is generally divided equally in California. While that means 50-50, it doesn’t mean that each person will get 50% of each specific asset.
Dividing property might seem simple at first glance, but it can get quite complicated for large estates.
Support Issues in Divorce
There are two types of support to consider in a divorce – spousal support and child support.
Spousal support, commonly known as alimony, is designed to help “support” one spouse while he or she adjusts to life during, and/or after divorce.
If you have children, child support will also need to be addressed. The significant change in income and living expenses requires that you take a closer look at the resources available to care for your children.
Spousal support, also referred to as alimony, is money paid to a spouse to help support him or her financially.
Spousal support can be temporary (before the divorce is granted), or permanent (after the divorce is granted).
Some of the factors that will impact spousal support include how long the parties were married, the earning capacity of each party, the contribution of each party during the marriage, the standard of living during the marriage, and many more factors.
Every parent has a legal obligation to support their minor children.
If you have minor children during a divorce, you will need to address the issue of child support because of the significant change in income and expenses.
The courts in California use a specific formula to determine child support. The factors include the income of each parent, the amount of time each parent will spend with the children, the disposable income available, health care expenses, and more.
Support Issues in Divorce
Most parents want to see their children as much as possible.
When you get divorced, your living arrangement changes and that can make it difficult for each parent to spend an equal amount of time with their children.
As part of the divorce process, the parties need to come up with a fair system that allows each parent to spend quality time with their children.
The 2 main issues involved in child custody are legal custody and physical custody.
Legal custody is the authority to make decisions for your child, such as education, health, discipline, etc. Legal custody can be sole or joint, just like physical custody.
With sole legal custody, one parent has the right to make all decisions for the child.
Joint legal custody means that both parents have a shared responsibility to make decisions for the child and each has an obligation to consult with the other parent before making major decisions.
Physical custody primarily refers to which parent the child will reside with. Physical custody can be sole or joint.
Sole physical custody means that the child will reside with one parent and the other parent will likely be permitted visitation rights.
Joint physical custody means that the child will reside with each parent, separately, for a specific, designated period of time.