Divorce divides assets accumulated during a marriage so it comes as no surprise that divorced people may be less prepared for retirement than those who were never married or who stayed married. However, North Carolina women who remain single after a divorce may be better prepared financially if they keep the family home. Keeping the house isn’t always a good plan so it’s important to weigh the pros and cons,both for the short-term and the future.
For many people going through a divorce, the family home represents stability. Keeping it might mean the children don’t have to change schools or lose contact with their friends. A home could hold many emotions and memories but it could also cause financial hardship for a single parent without enough income to pay the mortgage, taxes and upkeep for the home. During the negotiations, a spouse who wants to keep the family home may give up more liquid assets in exchange for one that may or may not increase in value over time.
A study by the Center for Retirement Research found that divorced spouses that were able to afford their home may be in a better financial position when they get ready to retire than those who opted to sell the house and downsize. By making payments on time every month, the mortgage will decrease over time while the value of the home is likely to increase. This gives those who gave up their portion of their ex-spouse’s retirement account a chance to build equity they could use when they’re ready to retire themselves.
Negotiating a property settlement may be an emotional experience. Choosing assets to keep or trade for other property shouldn’t be done without the guidance of an experienced divorce lawyer lawyer. A lawyer could help clients weigh the pros and cons of keeping versus selling various assets to help them plan for their future.