As you may have seen or read in the news, a majority of economists forecast a recession for the United States in 2023. In fact, a number of economic experts have reported that the recession has already started. So how does a recession impact New Jersey families going through or considering a divorce?
The Economic Recession and Its Influence on Families
An economic recession is a time marked by significant drops in wages, employment, and overall financial security, leading to considerable household economic hardship and widespread economic uncertainty. This uncertainty has profound impacts on children, youth, and families, causing ripples through the multiple contexts in which children and youth are situated. Stressors such as job loss, home foreclosure, or loss in family savings place strain on parental relationships and the family as a whole. In some instances, economic stress has been found to increase family stress and violence. Thus, the economic recession can harm family relationships and parenting, with significant differences seen in how mothers, fathers, sons, and daughters respond to the crisis.
The Recession’s Effect on New Jersey Family Law
In New Jersey, the economic realities of the impending recession may impact various aspects of family law, including equitable distribution of assets, child support, and alimony. The fair market value of many assets that are typically distributed in a divorce, such as the marital home, other real estate, and investments, may be lower than expected due to the reduced GDP. As a result, individuals may end up with less from their divorce than they initially hoped for. Additionally, economic restraints may force spouses to accept jobs outside of their training or career path, leading to potential changes in spousal support payments and child support requirements.
The Challenges Families Face in a Recession
During these trying economic times, not all couples handle financial strains during a divorce equally. Some may seek higher spousal support payments if they cannot secure employment in line with their training or career path. Others might attempt to manipulate the distribution of assets to their advantage, given the current low market values. Furthermore, the stress of the financial situation can lead to conflict and disagreements, potentially prolonging divorce settlements and escalating legal and court costs.
Alternative Options to Divorce in Economic Downturns
Given the financial challenges associated with divorce during an economic recession, alternatives to immediate divorce can be considered. These include simple separation, where couples live independently while still enjoying shared benefits such as tax advantages and healthcare. Divorce mediation is another option that facilitates agreement on contentious issues, thereby minimizing the chances of accruing hefty legal fees. Michael Rosenberg can help guide individuals through these alternatives or towards the most effective path forward, keeping the individual’s economic situation and future in mind.
Understanding the potential impacts of an economic recession on family law is crucial for anyone navigating these challenging times. This knowledge can provide a foundation for making informed decisions and seeking appropriate legal counsel to ensure the best possible outcomes for all involved.
Call Michael at (856) 350-6150 and schedule a consultation today so that you are prepared for any economic uncertainty your family might face.