Long-term finances often are ignored in divorce settlements

In a divorce settlement, it's common for both parties to focus on immediate financial concerns. Yet it is the long-term financial consequences of divorce that frequently are more devastating. Here are some of the most common mistakes and how to avoid them.

Taking the house. The spouse who will have custody of the children typically wants to keep the family home. While this may be desirable emotionally, it can be financially problematic.

A home is an illiquid asset that costs money to pay for and maintain. The parent with the children may not have the resources to take care of both the home and the children, particularly if they give up other financial resources in return for the house. Consequently, it may be better financially to sell the home and split the proceeds.

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