Divorce comes with emotional trauma and financial issues to be dealt with. In Minnesota, the couple has to plan on asset division, child custody and alimony. During a high net worth divorce, the couple should first review the prenuptial agreement, if one exists. These agreements are important because they detail out the property and financial division in the event of a future divorce. If there is no prenuptial agreement in place, the couple may have to divide the assets equally.
Before filing for divorce, the person should remember that a divorce proceeding freezes the person's assets and business evaluations. Also, the person should never lie about the financial and nonfinancial issues while undergoing a divorce. This may hurt the person's credibility in the proceedings.
As the property and assets need to be divided equally among the parties, if there is no prenuptial agreement, the parties may make a list of properties they may want to keep separate. Also, the parties may need to divide the retirement accounts, which requires a separate filing with the 401(k) companies.
Knowledge of the difference between child custody and alimony may also be essential during the divorce proceeding. The law in Minnesota has certain guidelines to be followed for child support and the person may have to give a certain share of the income. Also, the person may have to give alimony to the spouse. While child support payments are done for the child's upbringing, alimony ensures that the spouse can continue with the lifestyle followed during marriage. A certain percentage of alimony may be tax-deductible, an important thing to explore and understand, especially in high net worth divorces.
It is also suggested that the person make changes, if any, to the will before filing for divorce, as wills get frozen in a divorce proceeding if they include marital property.
Source: Fox Business, "Divorce Attorneys Share their Tips to Avoid Financial Mistakes When Splitting Up," Kate Rogers, Feb.19, 2013