By Andrew Zashin*

It feels today as if inflation is everywhere. You read about inflation in the paper, hear about it on the news and feel it in your pocketbook. Just this week, Sept. 21, the feds raised rates the highest its been since the global financial crisis in 2008. In other words, rising inflation is impacting our lives in multiple ways. For individuals contemplating divorce, it is important to consider both the negative and positive effects inflation may have on a divorce settlement.

Let’s start with the good news first. Home values remain high in part due to inflation. According to the Federal Reserve Board, the median sales price for a home located in the Midwest was $412,400 as of June. For many couples, the marital home tends to be the largest asset that the marriage holds. This means that a divorcing couple who agree to sell the marital home, can take advantage of the current inflated market and likely obtain top dollar for the marital home.

Here’s the bad news. Separating couples may find it difficult to secure new housing following the sale of the marital home. Higher mortgage rates and home prices are reducing affordability for buyers and driving up demand for rental accommodations. However, those individuals who can wait out the inflated housing market by living with friends and family can fare well following the sale of the marital home.

In other not so great news, separating couples are going to find that their dollar isn’t going as far as it once did. It is normal for separating couples to feel some financial pinch since uncoupling typically results in a reduction of household income (two incomes divided by two) but an increase in household expenses given the running of two households. However, due to inflation, that financial pinch has been upgraded to a financial squeeze. According to Reuters, food prices increased more than 11.4% over the past year. Further, household furnishings, motor vehicles, prescription costs and health care prices all increased by at least 0.4% over the last month. This means that a newly single individual will not only have to deal with the loss of their former spouse’s income, but will also have to manage an increase in regular household expenses.

If you are considering divorce in this current economy, it is a good idea to not only speak with an attorney, but also a financial planner. Both professionals can assist you in deciding what assets of the marriage will help you the most while also helping you understand your post-divorce financial life.

This article originally appeared as a column for the Cleveland Jewish News.