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Preparation for a high asset divorce can avoid pitfalls

The average divorce does not have to degenerate into the War of the Roses. Just because you and your spouse no longer want to continue being married to one another does not mean that you can't civilly agree on many issues. Below are some ways to make sure you have a soft landing after a divorce.

1. Settle as many issues as possible out of court.

Not only is it far less expensive, deciding matters between the two of you, or with the help of a mediator, keeps the acrimony out of the process.

2. Don't make financial decisions based on your emotions.

Emotions run high during a divorce, so make sure that your head and not your heart is in the driver's seat when it comes to important financial decisions affecting your and your children's futures.

3. Develop financial acumen.

No matter who was responsible for the family's finances in the past, it's your responsibility now to become financially literate to protect your future fortunes.

4. Learn how to strategically manage your debt.

Loan agreements are not trumped by divorce judgments, so make sure that you go into the divorce as financially healthy as possible. Understand that if your ex defaults on payments for jointly held debts, you could be left holding the bag, so factor that into any settlement agreements.

5. Understand the tax ramifications of child support and alimony.

Depending upon your tax situation, it may be better to receive or pay spousal support in a lump sum or in monthly installments for a set period of time.

6. Double-check your financial documents.

High-earning couples should make sure that their spouse's financial disclosure statements accurately reflect the true value of investments, wages and business interests.

7. Include a QDRO in your property settlement.

Understand that pension plans will not dispense benefits based on the property settlement in a divorce. You will need to include a Qualified Domestic Relations Order to be able to access benefits from a former spouse's plan.

The more assets and debts a couple have, the more complex their divorce will be. Make sure that your family law attorney considers all aspects of your family's situation when preparing the documents for your divorce.

Source: bankrate.com, "10 ways to avoid divorce disaster," Steve Santiago, accessed June 23, 2016

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