California divorce proceedings often result in economic consequences for the spouses involved. The community property laws in California make the income people earn during marriage shared or marital property. Spouses generally have an obligation to divide their resources and their financial obligations with each other.
Some couples are able to negotiate settlements directly with one another, while others have to seek the intervention of a family law judge. There are certain property division issues that are likely to trigger conflict between spouses. For example, the following are some of the most common issues that arise during property division negotiations during California divorces.
Issues with property valuation
Some assets are easy to value. A bank account has a specific balance, for example. Other assets can pose more of a challenge for the purposes of property valuation. Real estate, business holdings and other valuable resources may require professional valuation if spouses want to fairly determine the value of their marital property.
Concerns about retirements and pensions
People who retire have to live on a fixed income. They depend almost entirely on the savings they have set aside during their working careers and possibly on certain state benefits. It can therefore be very difficult for spouses to address retirement savings and pensions in a California divorce. It is common for some of the savings to be marital property and some to be separate property. There may also be reason to worry about taxes and penalties for early withdrawals. Spouses often have to tread carefully when addressing retirement accounts and pensions in a California divorce.
The need to share marital debts
People may take on a lot of financial responsibilities during marriage. They might have student loans and credit cards that they have to pay. It is common for any debts accumulated during the marriage to be part of the marital estate, and spouses may disagree about the most reasonable way to divide those debts. In some cases, it may be possible to exclude certain financial obligations from the marital estate because of financial infidelity during the marriage or intentional dissipation early in the divorce process.
All of these issues can complicate property division negotiations and trigger intense emotional reactions during California divorce proceedings. As such, preparing for the challenges of community property division can be beneficial for those in the early stages of divorce in California.