Today I want to talk about one of the biggest mistakes that I see people make when they are negotiating a divorce settlement with their spouse. And more often than not, this mistake happens when there is a power imbalance in the relationship.
In other words, one spouse has always been the “alpha-dog” of the relationship. They control everything from the finances, to family activities, to what everyone eats for dinner.
Or perhaps this occurs when one spouse hires a lawyer, leaving you unrepresented. They will have their lawyer draft an initial agreement and tell you that you have to sign it or else things will get nasty and the lawyers will take all of your life savings.
Or still another situation is where one spouse makes (and thus controls) all of the income for the family, thereby cutting you off financially if you don’t agree to their demands.
Whenever a client comes to us in these type of situations, our first piece of advice is to slow everything down. You can’t possibly expect to have a fair and balanced negotiation if you don’t even have time to think about your options and what is truly in your best interest.
So the single biggest mistake I see people make is that they agree to a rushed negotiation that ends up with them signing an agreement that is not in their best interest.
The Consequences of Signing a Bad Agreement
The consequences of signing a bad agreement are huge. A separation agreement can have life-altering consequences for you and your family. You may obligate yourself to an alimony payment that you can’t afford to pay for longer than you can afford to pay it. Or on the flip side, you may negotiate too low of a payment (or no payment at all), for too short a period of time.
When it comes to dividing up marital assets, you may find yourself losing out on your fair share of the property, which could include real estate, retirement accounts, investments, and cash. You may take on more of the marital debt than you otherwise should.
In a nutshell, you can make any number of mistakes in negotiating an agreement and those mistakes could stay with you for a very, very long time.
Many people want to just sign their agreement and move on with their lives. And while I can empathize with wanting your divorce to be over quickly, rushing this negotiation could have severe and long-lasting effects on your financial and personal well-being. Like it or not, you will have a life after your divorce. But the quality of that life can be significantly impacted by how well you (or preferably your lawyer) negotiate your separation agreement.
So when you are faced with a situation where your spouse is forcing you to move too quickly or agree to terms that you aren’t comfortable with or don’t seem fair to you, you need to slow things down.
Talk to a lawyer.
Take some time to yourself to think about what you are doing.
Don’t rush this.