Issues of Money: How Finances Factor into Your Divorce in New Jersey
Every divorce is unique, as is to be expected when considering the variety of individuals and dynamics that compose each relationship. However, a recurring theme among the vast majority of divorcing couples in New Jersey and elsewhere is the contentiousness of finances, as this issue generates significant dissension for so many during the divorce process. Perhaps, in part, this is driven by the many distinct components of this overarching issue. For example, “money,” may refer to decision-making regarding division of assets, debts, alimony, and child support. Money also represents one of the only quantifiable measures of your “investment” in the relationship and what you deserve moving forward.
Ultimately, final determinations involving finances can spell long-term implications for your financial future. The underlying cause of the these disagreements may change, but the problems that finances cause remains constant. Amidst the threats, ultimatums, and many highly stressful moments that may arise during discussions of finances, an experienced divorce attorney can serve as your greatest asset, becoming an intermediary, the champion of your interests, and the representative who can ensure that you receive the settlement that you deserve. This week, we will delve into several of the financial issues that must be addressed during your divorce, as well as the variety of the factors that influence these outcomes.
First, it is important to understand that New Jersey is known as an “equitable distribution state.” The term can be misleading, so let’s clarify it’s meaning. Equitable distribution does not mean that assets and debts will be divided in half or “straight down the middle;” in fact, it only means that all assets and debts considered marital property will be divided fairly. The subjectivity of “fairness” certainly allows for a great deal of interpretation, further complicating discussions among divorcing spouses and their representatives. What then are the factors considered during asset division determinations? They include:
- The length of the marriage
- The age and physical health of each spouse
- The property and income that each spouse brought to the marriage
- The standard of living established during the marriage
For a more comprehensive list of the factors considered when evaluating asset and debt division, click here. Notably, these factors also become essential during alimony determinations, which may include: pendente lite (temporary) alimony, open durational alimony, limited duration alimony, rehabilitative alimony, and reimbursement alimony, each of which is described in more detail in our Types of Alimony page.
For the purposes of this discussion, we must understand the difference between pendente lite alimony and the alimony configuration included in your final divorce decree. During the divorce process, the law provides that both parties should maintain the same quality of life that they maintained during the marriage. Pendente lite alimony serves as the financial arrangement by which this is achieved “pending the litigation,” meaning prior to the resolution of the divorce. During divorce proceedings, the ultimate alimony determination will be made and will commence once the divorce is finalized, at which time pendente lite alimony is terminated. It is important to note that pendente lite alimony and the alimony included in the final divorce decree may be very different, as during the divorce, a more complete picture of the financial situation of the family is revealed.
Last of the significant financial considerations during the divorce process, which of course only applies in situations involving children, is child support. These agreements vary significantly in each situation but are contingent upon a number of factors; paramount among them are the respective incomes of the parents and the amount of time that the child will spends with each parent. Accounting for the fixed, variable, and controlled expenses of each parent, the child support determination is aimed at allowing each parent to provide a similar standard of living to the child, obviously, with more resources dedicated to the parent who is awarded sole custody or responsible for more of the care-taking in situations where that applies.
Overall, the financial component of your divorce may generate significant discord between you and your spouse. However, the emotionally-charged nature of these disagreements need not hinder your efforts to achieve a fair and favorable resolution. In fact, your divorce attorney can take the lead in these discussions and ensure that you are justly compensated. If you are considering a divorce in New Jersey, have recently initiated the divorce process, or are seeking a post-divorce modification, feel free to contact my offices anytime at (908) 481-4625 for an initial consultation. I am always available to answer your questions.