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Westlake Village Legal Blog

Which groups of Americans have the most debt?

Households in California with high credit card debt are part of a trend across the country. Many Americans are charging their way to high debt, and carrying balances from month to month. Statistics show an average individual credit card debt of more than $5,000 in 2019. Paying the bill in full each month eliminates interest charges, but less than half of the country's credit card users are doing that routinely.

Statistics on credit card use by age and income level generally show that people with more income have higher credit card debt. People age 35 and under and those who are at or over the age of 75 have the lowest average credit card debt. People generally earn the most money in middle age, and the highest average credit card debt is in the 45 to 54 age bracket.

Steps to Keep a Divorce Civil

When marriages break down and end in divorce, it's common for the split to be adversarial. Many California divorces are framed as a debate between who 'won" and 'lost" the division of property. But when a divorce devolves into a battle, more often than not both sides lose. However, it is possible to prevent a divorce turning into a war by working together. Here are a few tips that can help.

First, consider the history of your marriage. The things that lead to conflict during your marriage may also cause issues during your divorce. You may be able to avoid conflicts by navigating sensitive issues carefully.

The increase in gray divorces

Older married residents of California may be interested to learn that 25 percent of the people in the United States who get a divorce are at least 50 years old. This is as the rates of divorce for other age groups have either become constant or have dropped.

According to research, less than 10 percent of Americans who were getting a divorce in 1990 were older than 50. The research also indicated that the older divorcees were not limited to those who had remarried; in fact, more than 50 percent of gray divorces are couples who have been married an excess of 20 years.

Tips for paying for a child's college education after divorce

The College Board reports that costs for college go up at least 3 percent every year. Despite these rising costs, most couples do not have a financial plan in case one dies or the two get divorced. California parents generally cannot be required to pay for a child's college education after divorce, but it may be an issue parents wish to address in the divorce agreement.

Maintaining two households can create a significant financial strain that makes it difficult to continue saving for college. Spousal and child support payments must be prioritized over paying for college, but parents may already have a 529 plan at the time of the divorce. There are no taxes on funds withdrawn from a 529 plan that go toward education, so it can be an excellent option for college savings. However, since it is usually owned by one parent and the owner can change the beneficiary or owner, parents may want to address its use in the divorce agreement. They could also split the 529 plan, or each could be given the ability to monitor it.

Research suggests divorce more likely when wives are ill

Couples tying the knot in California generally have a mutual desire to stick by one another no matter what life together brings. However, when serious health-related issues affect women, research suggests that their marriages may be more likely to come to an end. Multiple clinical studies have found that women diagnosed with cancer are at a higher risk for divorce than men with cancer. Results from another study show that women with stroke and heart problems are also more likely to see their marriages end than men with similar conditions.

As for why men tend to be more likely to seek out a family law attorney to discuss divorce than women when a spouse is ill, one theory is that women typically provide more support and care for their significant others. When a wife is no longer able to provide such benefits, some men prefer to walk away from a marriage. Also, women are more likely to have a wider support circle of friends and family members than men, who often rely on their wives to fill this role.

Things to avoid in a high-asset divorce

California couples with a high amount of wealth who decide to divorce have a lot of obstacles when it comes to the legal process. Everything from deciding who gets how much of a business to the custody of children can be up for debate, potentially making things very difficult. In order to avoid as much hassle as possible, it's important for each party to have very focused priorities. No one involved is going to get everything they want, but being willing to compromise on more trivial points can provide leverage on the important topics.

The decisions made during a divorce of a wealthy couple will likely have large ripple effects long into the future. Each party should use the resources at their disposal to make sure they do things right. That means hiring professionals who can provide advice about topics related to finance, real estate, child custody, and insurance. Even hiring a therapist to get through the emotional aspects of the divorce may help everyone cope in the short and long term.

Protecting parental rights in a custody battle

Fathers in California who want to take an active role in their children's lives may sometimes need to file a petition in state court to assert their visitation rights or fight for primary custody. Courts are increasingly recognizing the important role that fathers play in their children's lives.

Many children end up living primarily with their mothers, but there is a lot that fathers can do to protect their rights and have a better chance of getting more parenting time with their children. One thing that parents should keep in mind is the amount of time that they can actually spend with their children. If another relative would need to spend time watching a child during an allotted visitation time, it might be best to consider allowing the child to spend time with the other parent instead.

Joint custody is usually healthier for kids

A pending separation or divorce can cause all sorts of emotional upheaval for a California family. Since decisions may need to be made about child custody matters, both parents should carefully weigh their options. One of the best solutions is for moms and dads to respect each other's relationships with their children and work out a custody agreement that offers the optimal parenting plan for everyone.

Researchers around the world concur that joint physical custody is typically the better answer over sole physical custody from a child development perspective. It is important for children of every age group, including infants and toddlers, to have consistent parenting from both moms and dads. A parenting plan such as this seems to give kids the best chance at growing up mentally and physically healthy. Studies show that children who spend equal time with both parents have fewer instances of stress-related illness, and their emotional and behavioral health usually reaps benefits as well.

The new year is accompanied by new alimony rules

California couples may be concerned about how the new tax rules may affect their plans to divorce. These changes, included in the 2017 tax bill, were scheduled to go into effect in 2019. This spurred many unhappy couples to escalate their divorce timelines in order to maintain the current tax system. Couples who finalize their divorces in 2018 will continue to use the old system, but divorces finalized after the new year will operate according to the new rules.

The changes affect how spousal support payments are taxed. For decades, alimony payments have been tax deductible for the paying partner. At the same time, the recipient paid taxes on the payments at his or her own tax bracket, which was usually lower. As a result, there was a strong incentive for a wealthier partner to agree to generous support payments in order to settle a divorce. Under the new provisions, payments will no longer be tax-deductible for the paying partner, and the recipient will receive the income tax free. This may appear to be a boon to recipients, but it's likely to lead to lower payments overall.

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