“Penny wise, pound foolish.”
That time-honored American adage refers, of course, to the rather myopic view that many people take in various contexts when, by taking the cheapest possible route toward accomplishing a goal, they ultimately spend far more money in the end because they engaged in excessive cost cutting at every corner.
In other words, while they seemingly won the game, they actually end up losing the war.
We modestly submit at the New Haven family law firm of Berdon, Young & Margolis, PC, that divorce solidly qualifies as a realm where an overriding focus initially on cost at every juncture can ultimately break the personal savings bank.
“You [can] save on lawyer fees,” we stress, “but you can get hit hard in property division, child custody and other issues being negotiated.”
And if you’re a strong do-it-yourself advocate, many important focal points of divorce might not get addressed at all.
A recent Forbes article renders that point crystal clear, noting especially the “unintended financial consequences” that can flow from not paying due attention to key divorce-related retirement matters.
Like QDRO, for instance. A Qualified Domestic Relations Order is the official vehicle required for dividing up assets in a company-sponsored retirement plan. There are myriad complexities linked with that, including due consideration of the potential to make timely withdrawal for non-retirement reasons without penalty.
And proven divorce attorneys frequently remind clients to take actions that properly reflect their thinking regarding beneficiary designations relevant to various savings/retirement accounts. Forgetting to timely and accurately do this can have flatly dire consequences.
So, too, can have failure to thoroughly review and understand all options germane to Social Security entitlements in the wake of divorce, as well as a disregard of the need to reassess risk tolerance once an equitable division of assets in divorce has been effected.
“Divorce is an emotional, life-altering event,” notes Forbes.
Having a dispassionate and seasoned family law attorney firmly on board throughout the process can help ensure that sound and duly reflective strategies are pursued and choices made regarding fundamentally important financial matters.