When it comes to divorce and finances, there’s an entire vocabulary of terms you’ll encounter that could seem confusing at first. Let’s unpack some of the most common and important terms you might hear related to money and finances as you move through the divorce process.
What is alimony?
A court may order a supporting ex-spouse to pay financial support, with regular, recurring alimony payments after a divorce or separation, to a dependent ex-spouse. It’s also sometimes called spousal support or maintenance.What are community states?
In these states, the courts presume both spouses equally own all marital property. This generally results in a 50-50 split.
Alaska is an opt-in community property state, this gives both parties the option to make their property community property.
What are equitable-property states?
In equitable distribution states property is distributed fairly—but not necessarily equally.Financial affidavit vs. lifestyle analysis
A financial affidavit is a comprehensive overview of your financial situation over a relatively fixed amount of time. It’s usually created by each spouse and reviewed by an attorney and can often include estimates.
The scope of a lifestyle analysis can broaden to include several years, includes specific amounts, and is typically prepared by a forensic accountant.
Legal separation vs. divorce
Legal separation and divorce have many aspects in common. In both scenarios, marital assets and debts are divided between spouses, and spousal support (alimony), custody, and child support are determined.
However, neither spouse can remarry during a legal separation. Different states may have different definitions of legal separation.
Separate vs. marital assets
Property that a spouse acquired before marriage, or received separately as a gift, inheritance, or award from a lawsuit during the marriage, is usually considered separate property.
Property acquired jointly during the marriage is usually considered marital property.