Category: Budgets

7 Costly Mistakes To Avoid In Budgets

Presenting credible evidence to support a client’s budget or discredit a spouse’s budgetary claims can ultimately save clients thousands of dollars or more per year.

Credible evidence includes a reliable analysis of the parties’ historical spending to show the marital standard of living.  In addition, to be credible, a projected living expense budget must be reasonable based on the marital standard of living as well as current expenses. Below are some mistakes to avoid when preparing a marital standard of living budget or projected living expense budget, or when analyzing a spouse’s claimed budget:

1.  Annual Or Quarterly Amounts Listed In A Monthly Budget

Examples: association dues, life insurance, AAA membership

2.  Double-Counting Of Expenses

Examples: homestead, insurance, real estate taxes

3. Expenses for Others

Examples: grandchildren, parents, significant others, friends

4. Expenses for Children Who Are Now Emancipated

Examples: college expenses, travel expenses, cell phone

5. One-Time Expenses Treated As Ongoing Expenses

Examples: basement finish, boat purchase, car purchase for child

6. Failure To Include Expenses Not In Bank Or Credit Card Statements

Examples: deducted from paychecks, paid in cash

7. Failure To Use Current Expenses (Which Have Changed Over Time)

Examples: utilities, real estate taxes, gym membership

To Retain A Credible Budget Expert, Contact Essential Litigation Partners

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