It is entirely possible for you to work through multiple legal cases all at the same time. As a personal injury lawyer can share, it is common to see a personal injury case occur alongside a divorce case. When this happens, many people often ask, how will a personal injury settlement affect my divorce case? Each case is unique, so it is always best to work with a team that includes a lawyer and a financial analyst. Otherwise, a single misstep in either case could cost you thousands of dollars.
How These Cases Intersect
Personal injury settlements can affect several areas of divorce law such as marital property, spousal support, and child support. If you win a large case, that can be attributed to you as income thereby increasing the amount of spousal and/or child support you are required to provide. Compensation from a PI case covers many different categories such as medical bills, lost wages, future earnings, and even pain and suffering.
In divorce court, each of these assets are handled differently. For example, payment for lost wages in your PI settlement may be considered marital property if at the time you lost those wages, you were still married. However, pain and suffering are often handled separately so it would not be considered marital property. As our friends at Cohen & Cohen want to remind you, it is important to reiterate that each case is unique. Therefore, what works for one case does not always work in another. That is why you should work with a knowledgeable team that can cover every aspect of your case from legal to financial.
How Each Party Helps You
Your injury lawyer calculates damages, negotiates settlements, and helps to structure awards at the end of the case. This is especially important as damages should be clearly categorized in your settlement to avoid confusion in divorce court. For example, the settlement needs to be defined for what portion is lost wages and what portion is for pain and suffering because those are often treated differently in divorce court. Additionally, your injury attorney can help to advise you on how to protect your settlement funds from becoming improperly included in your divorce case.
A divorce financial analyst takes a deep dive into your finances. They advise you on your risks and opportunities when it comes to your divorce case. In particular, they look at asset division, long-term financial planning, tax implications, and more. If you are looking at a personal injury settlement, they will also evaluate how that will affect child support, spousal support, and division of marital assets to name a few topics. A financial analyst will also look at your future with regards to long-term issues that might affect your financial situation such as future medical costs or reduced earning capacity. At the end of the day, your financial analyst will advise you and where your assets stand, what might happen to them in the future, and how to protect them.
Collaboration Across Your Case Can Save You Thousands
Bringing your injury lawyer and financial analyst together will prevent issues such as double-counting or misallocation of funds. For example, if an injury settlement includes lost wages, a divorce financial analyst will ensure that those are treated properly during a divorce. Together, the two will ensure consistency across your case and give you peace of mind that your assets are being protected now and into the future. If you or someone you know is facing a divorce case and personal injury case at the same time, reach out to knowledgeable professionals near you, including a lawyer and financial