High-Asset Divorce

Mandatory Disclosure in Divorce

In Massachusetts, when a party files for Divorce, Massachusetts Rules of Domestic Relations Procedure, Supplemental Rule 410, Mandatory Self Disclosure, requires that certain documentation be disclosed to the other party within 45 days of service of the summons for a divorce proceeding. The parties may agree otherwise or the court may order a disclosure or non-disclosure. The documentation that must be disclosed is as follows: (1) The parties’ federal and state income tax returns and schedules for the past three (3) years and any non- public, limited partnership and privately held corporate returns for any entity in which either party has an interest together with all supporting documentation for tax returns, including but not limited to W-2’s, 1099’s 1098’s, K- 1, Schedule C and Schedule E. (2) The four (4) most recent pay stubs from each employer for whom the party worked. (3) Documentation regarding the cost and nature of available health insurance coverage. (4) Statements for the past three (3) years for all bank accounts held in the name of either party individually or jointly, or in the name of another person for the benefit of either party, or held by either party for the benefit of the parties’ minor child(ren). (5) Statements for the past three (3) years for any securities, stocks, bonds, notes or obligations, certificates of deposit owned or held by either party or held by either party for the benefit of the parties’ minor child(ren), 401K statements, IRA statements, and pension plan statements for all

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3 tips to protect yourself financially in a divorce

If you had to, could you list off your family’s income, assets and debts with a reasonable certainty? If the answer is, “No,” then you need to educate yourself financially before you initiate your divorce. Many times, high-profile couples have prospered together with one spouse taking the financial reigns and the other handling the home and children. When a divorce happens, the less financially-educated spouse often has no idea what sort of stock options the couple holds, what other investments they have or even what banks they’re spread around. Sometimes they aren’t even aware of property they own because the spouse handling the income bought it as an investment and didn’t bother telling them. Here are three things that you need to do as quickly as possible if you suspect a divorce is on the horizon: — Document everything. Get copies of every tax return, deed, bank record, bill or brokerage statements. Get your insurance paperwork together, including inventories of the household goods. Copies of your spouse’s business records for the last several years are also valuable — especially if you think the business may be worth more than he or she is letting on. 2. Put money aside. You are going to need more money than you realize — part of it will go to attorney fees, but part of it will go to just ordinary living expenses and you probably don’t really know what those are yet. You may have additional expenses like therapy bills, new furniture for

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Advice from financial planners on preparing for divorce

Many married couples live comfortably for years without thinking much about how much they have saved for retirement. If they get divorced, as couples over 50 are increasingly doing, and they have to divide up their assets, they often realize that they’ve been spending too much and saving too little. Many Americans reach that realization as they get closer to retirement. However, when you’re suddenly faced with living on roughly half the income you’re used to while maintaining your own home, the financial consequences of inadequate planning can be particularly serious. Financial planners note a number of things that they’ve found with their divorced clients and have some advice based on their experience to help people better prepare for the potential of retirement years without their spouse. — Over 75 percent say that people should learn how to better manage their finances. — Some 73 percent say people should understand the long-term consequences of their divorce. — Almost 57 percent say they should understand the tax implications of their settlement. — Over 50 percent recommend increasing retirement savings. — Almost 43 percent recommend reducing spending. — Over 36 percent suggest getting a prenuptial agreement. — Over 19 percent recommend getting long-term care insurance. — Almost 18 percent recommend selling off high-value assets like real estate before the divorce settlement is final. Many of these recommendations are wise whether you and your spouse live out the rest of your lives together or call it quits. If you’re already at the stage

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What areas have the highest divorce rates in Massachusetts?

Overall, Massachusetts has one of the lowest divorce rates in the country. Only seven states rank lower than we do. Almost 10 percent of all adults in Massachusetts are divorced, according to the Census Bureau, and another 2 percent are separated. However, the city and possibly even the zip code where you live just might have something to do with your chances of getting divorced. Some areas of Massachusetts have considerably higher divorce rates than the state average. Following are the 10 with the highest percentages of divorced adults: — One part of Fall River (the 02723 zip code) comes in first at 17.7 percent. — Hyannis is second at 15.8 percent. — N. Adams is close behind at 15.6 percent. — The 01604 zip code of Worcester is fourth at 14.4 percent. — Just behind it is Newburyport at 14.2. — Pittsfield ranks sixth at 13.7 percent — Gardner and Taunton are tied for seventh at 13.5 percent — Another section of Fall River (02720) is eighth at 13.4 percent — Amesbury and Athol are tied for ninth at 13.3 percent — The 01605 zip code of Worcester ranks tenth at 13 percent. Divorce rates can vary even within one city, as we see with Fall River and Worcester, let alone within a state. Even if you feel like no one else is in your shoes, you can be assured that many people are. Often having a therapist or even a support group to turn to during a divorce

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It’s essential to protect your credit during divorce

After a divorce, your credit will be more important than ever. Most people need to either rent an apartment or buy a new house. They often need to get some type of loan, such as for a new car. They may need to look for a job. That’s why it’s essential to take steps to protect your individual credit, which has likely become entwined with your spouse’s during the marriage, before, during and after the divorce. It’s essential to be cautious about what your spouse is doing with any joint credit cards and bank accounts. Consult with your attorney about the steps you need to take to start separating your accounts. In the meantime, keep an eye out for large unnecessary withdrawals by your spouse from your bank accounts as well as significant charges to your credit cards. Angry, vindictive spouses have been known to drain bank accounts and leave their husband or wife holding the bag for significant credit card debt. If you believe that your spouse is taking such actions, tell your attorney immediately so that he or she can work to put a stop to it. Another problem that can negatively impact your credit is if you and/or your spouse don’t make timely payments on your joint financial obligations. This includes not just mortgages, car loans and other joint debt, but things like utility bills. It’s essential that spouses determine who will continue to make these payments during the divorce process. Even if your spouse has agreed

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Divorcing at an older age

Although statistics suggest that the rate of divorce may be stabilizing across the US, one demographic is experiencing in increase in divorce rates. Americans aged 50 and older in Massachusetts and elsewhere are turning to divorce now, more than ever before. A professor at a leading university asserts that in 1990, less than one out of every ten people who filed for divorce were age 50 or older; today, that number has skyrocketed to one in four. Although the reasons for filing for divorce at a later age may differ for each individual, older adults who are ending their marriages share some commonalities. One is a more complex division of marital property, as each spouse may have accumulated a diverse set of assets over the course of their lives. Sociologists suggest that there are many factors that lead older Americans to seek divorce. Many have stayed in lackluster marriages as their children have grown to adulthood, believing that prolonging the split would be easier on their children. Another approach on aging suggests that 50 may be the new 30. Unhappy spouses recognize that they have the potential for longevity, recognizing that there may be a long road ahead plagued by unhappiness in their existing marriage. Additionally, more women are now engaged within the workforce, and are no longer financially dependent upon their husbands for financial stability. The American Association of Retired Persons supports this theory, pointing out that women over age 50 initiate divorce more often than men. It was

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Why married women need to be ‘financial grown-ups’

In a new book written by a personal finance columnist for Reuters, people who have achieved considerable success in business and finance discuss when they first became “financial grownups” in their own lives. For one woman, Sallie Krawcheck, a former executive with Citigroup and Bank of America and founder of an investment website, it wasn’t until she and her husband divorced when she was 28. That’s not unusual. Many women, even today, don’t find themselves taking control of their own finances until they and their husband split up. Ellevest, the website founded by Krawcheck, provides a digital investment platform for low-cost investment in exchange-traded funds (commonly known as ETFs) to help them build wealth. Krawcheck noted that changes in a person’s life can happen without warning. Whether it’s the death of a spouse or (as in her case) learning that your spouse is cheating on you, women who haven’t been actively involved in the household finances can find themselves having to deal with issues they aren’t prepared to handle at one of the most emotionally-devastating periods of their lives. She says it’s a “recipe for financial disaster.” Krawcheck admits that even though she was building a successful financial career when she was married, she was “managing my own finances like a 1950s-era, stay-at-home housewife. He paid the bills, he made the financial decisions. I didn’t even know what our assets were.” She advises all women to take control of their finances and for married women to learn from her mistakes

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Divorcing individuals in Massachusetts should examine their finances

Because couples in Massachusetts are not immune to potentially going through divorce, it is important to understand what separation could mean if such a decision is made. Financial needs will differ after a couple separates, and there will be many agreements that will need to be made in terms of alimony and other aspects. As a result, it is important for parties to understand their financial situation before divorce takes place. Bank accounts are one area that should be noted before separation. This examination will allow a party to understand how much money is in those accounts and what division of those funds could mean for their situation. If divorce has been decided upon, opening a bank account that is not shared with the other party is a wise step. Examining the debt that could be taken on after divorce is also an action that an individual may wish to carry out. Attempting to diffuse any accumulated debt before the separation would be ideal. However, many individuals know that it is not always easy to repay balances quickly, and therefore, preparing a payment plan for after divorce could be beneficial. Financial needs are important to assess at any time, but it can make a considerable difference when divorce is on the horizon. Understanding the current state of finances will help prepare for the future and how those funds will be impacted by alimony, child support and property division. Having the right information on such issues can play a role in

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