Do You Need a Certified Divorce Financial Analyst?

Date: January 19,  2015
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Categories: Divorce

Many divorcing couples would answer ‘no’ if they were asked if they should hire a financial analyst. After all, the assets of the average couple aren’t extraordinary, and the cost of a divorce is high enough without hiring people unnecessarily. Besides, don’t the lawyers help value and divide assets? No, in most cases the lawyers lack the training, knowledge and expertise to competently analyze the couple’s finances. Even if a lawyer is versed in finance, there are other, equally important reasons why it pays to hire a certified divorce financial analyst (CDFA).

Saves Time and Money

In the early part of the proceedings, much time is spent grappling with the financial components of the divorce. Since most lawyers aren’t equipped to competently manage the minutiae of the couple’s assets, a CDFA can step in and handle every aspect of the finances. This saves time and frustration, and the CDFA can provide the divorcing couple with a complete analysis of their assets. Since the services of a CDFA cost significantly less than those of a divorce lawyer, it can also save money.

Plan for the Future

A substantial part of the discussion surrounding asset division will revolve around the financial future of both parties. By studying the proposed division of the couple’s assets, a CDFA can perform an objective analysis, and project how such a division would impact future spending and lifestyle choices for both parties. That information can be critical to the way joint assets end up being divided. Once a final division has been determined, the CDFA can then help with post-divorce financial planning.

Plan for Taxes

Another important role of a CDFA is that of a tax advisor. When the divorcing couple is discussing how the marital property should be split, a CDFA can explain the tax implications of selling, dividing and holding onto specific assets. However, while a CDFA can advise a couple on divorce-related tax matters, he may not be an expert in other tax areas.

Answer Questions

Even if a divorcing couple doesn’t want to hire a CDFA, it can still pay to consult one. A CDFA can provide the answers to important questions that can help the couple decide on their own how to divide their marital assets. Prior to a one-time consultation, make a list of any general finance-related questions you need answered. Sample questions might include the following:

  • What is ‘individual property’, and what is ‘joint property’?
  • What are the long term financial implications of certain decisions?
  • How are pensions and retirement funds split?
  • Should you keep the house or sell it?
  • How is joint property valued?

Find Hidden Assets

In some marriages, one spouse is primarily responsible for the family’s finances. In that scenario, when the couple decides to divorce, the other spouse may feel left in the dark, and concerned there may be assets he or she doesn’t know about. Much like a forensic accountant, a CDFA can help identify hidden assets.

 

A certified divorce financial analyst can assist divorcing couples with myriad financial-related issues, so the earlier in the proceedings a CDFA is brought in, the better. Working with a CDFA helps ensure financial transparency, accuracy and equity in the divorce process. Most divorcing couples, regardless of the value of their assets, would benefit from consulting a CDFA.

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Choosing a Divorce Mediator: Pros, Cons and Questions to Ask

Date: December 16,  2014
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Categories: Divorce

The role of a divorce mediator is one of neutrality. Mediators guide divorcing couples through the process, helping them reach an agreement on the division of assets and debt, alimony and child support, as well as child custody. Divorce mediators do not make decisions for the couple though. Instead, they provide guidance that helps the couple make their own decisions. The high cost of litigation leads many people to try mediation first, and some do find success. But, before deciding to follow suit yourself, read on for the pros and cons of using a divorce mediator. When it works, it works well, but mediation isn’t necessarily for everyone.

Advantages of Mediation

Divorcing couples who choose mediation often end up forging a more communicative and emotionally healthy relationship in the long term because there is no fighting involved. The amicable approach is also easier on children and it can be expedited, as opposed to the protracted litigation that often accompanies a court battle. In addition, since the mediator does not make any decisions for the couple, the couple maintains complete control. Mediation is also private, whereas litigation is public. The process is also less expensive than litigation which can require multiple hearings and, often, a trial.

Disadvantages of Mediation

If negotiations fail, the parties will have wasted both time and money because they will have to start the process over again. Another disadvantage to choosing mediation is that it could result in an agreement that is unenforceable. That is, if the mediation agreement ends up plainly favoring one party over another, it can be challenged. Also, all information that is disclosed is voluntary, so one party could potentially hide assets from the other. If one party is dominant, that could also carry over into the mediation process, leaving the submissive partner in an unfair position.

Tips for Choosing a Mediator

If you and your spouse feel that mediation is a good fit for your situation, the next step is to find a mediator that you both agree on. If you know someone who previously used a divorce mediator, that’s a good place to start. Word of mouth referrals are valuable because family and friends will offer honest feedback.
However, if you search for a mediator on your own, you won’t have the assurance of a personal referral. So, it will be incumbent upon you to filter the bad from the good. After all, this is the person who will be guiding you through your divorce. Here are eight questions to ask that will help lead you in the right direction:

  • How much specialized training has the mediator had?
  • Does the mediator have a law or mental health degree?
  • How familiar is he with your state’s divorce laws?
  • How long has the mediator been practicing, and how many divorces has he mediated?
  • What is his mediation style (directive, facilitative)?
  • What does he charge?
  • Will he provide a free introductory consultation?
  • Can he provide current, local references?

Mediation is not for all couples. It will not work if one or both parties is emotionally or physically abusive, unreasonable and unwilling to negotiate, or hiding assets. But, it can work if both parties can get along reasonably well, are honest, open to compromise, and willing to negotiate fairly.

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Celebrity Divorce and Asset Division: Are They Just Like Us?

Date: November 20,  2014
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Categories: Divorce

When celebrity couples get married, the expense and glamor of it all creates the illusion that their lives are perfect and uncluttered by the everyday troubles of regular people. Of course, that’s obviously not the case. The media inundates us daily with information about every step of any given celebrity’s divorce process, so it’s clear that celebrities experience marriage-ending troubles, too. The type of issues they face will include many pressures not known in most standard marriages (media pressure, time apart), but the result is the same. They, too, end up divorcing, and fighting over children and assets.

Are We Really the Same?

Yes, in some ways. First, the rules of engagement between parties are the same regardless of socioeconomic status. Famous divorce attorney, Laura Wasser, who has represented celebrities including Britney Spears and Angelina Jolie, drives that point home with her list of the top ten rules divorcing couples should follow. She lists ideas, such as clear and respectful communication, counseling, and remembering that the divorce is a business transaction. Not only is it a good list to follow, but the suggestions show that the behavioral guidelines are the same for everyone because they’re relevant for anyone seeking a divorce, whether they’ve reached celebrity status or not.

Second, on the legal frontier, outside of the occasional report of a celebrity getting special judicial treatment, celebrities also have to follow the same legal steps and timelines related to asset division and divorce in general. The requirements vary by state the same way for them, too. But, because they are in the public eye and typically have much more money and other property to divide, there are sure to be some differences, right? Here’s a look.

A Look at Celebrity Asset Division in Divorce

Since celebrity couples typically have more assets to divide, and their lives are more financially complicated than non-celebrities, it makes sense that the division of said property would be more difficult. Such was the case in Mel Gibson’s divorce, where his ex-wife Robin received $425 million in cash and other assets, as well as half of his film residuals for the rest of her life. However, the former Mrs. Gibson filed for divorce in 2009, but it was not finalized until 2011. Regardless of celebrity status, two years is not an uncommon length of time to divide an estate that size.

An additional pressure celebrities may face involves public scrutiny. The spouses may be concerned about the details of their divorce going public, and what image that may convey. If a celebrity’s “goodwill” value is negatively impacted, both parties could suffer financially. So, they may be more inclined to resolves issues quickly and peacefully.

On the other hand, in some celebrity divorces, the path is made easier because each spouse maintained separate bank accounts and individual asset trails throughout the marriage. The Bruce and Kris Jenner divorce is a good example of that scenario. Unfortunately, for the average marriage, that’s generally not the case. That’s because the couple’s finances are not as complicated as they are in celebrity households, there’s only one wage earner, or both parties rely on one another to help pay their bills.

 

The takeaway is that, when it comes to divorce and asset division, the same procedural rules that apply to non-celebrity couples are supposed to apply to celebrity couples. There are differences, of course, but they focus on the areas of the causes of marital pressure, how assets impact expediency, and motivations for peaceful property division. In short, divorce is challenging for all who undertake it, regardless of socioeconomic status, even if those challenges differ. When it comes to asset division and celebrity divorce, their process is just as decidedly unglamorous as it is for the rest of us.

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Finding Your Balance: Telling the Kids about the Divorce

Date: October 28,  2014
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Categories: Divorce

Divorce is the most entangled and emotional when children are involved. Not only do the spouses have to negotiate over material assets, they must contend with the very personal decisions regarding child custody. Divorcing couples with children also have to find ways to help their children cope with the divorce during and after the process.

The divorce process starts for children the moment they’re told that it’s happening. So, consider very carefully what you’re going to say and where you’re going to say it when making the announcement. The more balanced your approach, the more you can help your children get through it as smoothly as possible, given the circumstances.

Snapshot in Time

For better or worse, the moment children hear that their parents are getting divorced is a memory that stays with them. So, bear that in mind when deciding where to tell them, and do take time to contemplate the setting. When choosing a location, there are two characteristics to consider.

Start by considering places that aren’t too public. News that significant can cause elevated, unexpected emotions and children need a safe place to express themselves.

Second, choose a location away from home so the children won’t associate where they live with the memory of receiving the news. It’s a difficult balance of priorities, so it can be equally difficult to pinpoint the right spot. Ideas might include a counselor’s office or relative’s home. When deciding where to tell your children that you’re getting a divorce, don’t underestimate the power of the news you will be delivering or the length of time they’ll need to process it.

Write it Down

The initial conversation you will be having with your children about the divorce should not be off-the-cuff and spontaneous. You’ll probably be experiencing intense emotions right along with your children, and in order to help you keep your cool and get them through it, you need to be prepared. Write down the main points, so you don’t forget anything significant. But, keep it short.

The news will already be overwhelming to the kids. They don’t need to be further burdened by information that is unnecessary at the time, so balance plays a role here, as it does in your decision about where to tell them. Leave plenty of time for questions and emotion, but don’t leave out what matters most. Include the following information and answer these questions when planning what to say:

• Are we moving? Is mom/dad moving?
• Which parent will we live with? Are we still a family?
• Explain that it is not their fault and they are still loved
• Assure them that their needs will be met
• Make them feel confident that they can come to you with questions anytime

The list is fairly short and simple, but it’s also an important tool that will allow you to provide your children with the answers and assurance they need. By preparing the list ahead of time you will have more confidence in the process, too.

 

Telling your kids that you are divorcing is not going to be easy on you or them. Preparing what you plan to say and choosing the location carefully, however, will help give you the balance you need and ease the burden for all of you.

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Collaborative vs. Litigated Divorces: Choosing The Right Path

Date: October 02,  2014
Author: admin
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Categories: Divorce

Just as there are multiple reasons why couples choose to seek a divorce, there are also multiple paths available to obtain the divorce. The type of divorce you choose will depend on a number of factors, including size and complexity of the estate to be divided, whether or not minor children are involved, and whether or not you and your spouse are cooperative with one another.

Of the four types of divorce, which are collaborative, litigated, mediated, and do-it-yourself, both the collaborative and litigated divorce processes require attorneys. A collaborative divorce is less expensive and allows the couple to avoid court until the end, but if the spouses aren’t on civil terms, litigation may be the only appropriate path.

Collaborative Divorce

If a couple want to avoid going to court, a collaborative divorce may be a good option. A cooperative effort must be made throughout the process because all parties in a collaborative divorce, including the attorneys, must sign agreements that require both lawyers to remove themselves from the case if litigation is threatened or the parties cannot reach a settlement. That means that you will have to start over completely and hire new lawyers. So, cooperation and flexibility are essential in a collaborative divorce.

In addition to an attorney experienced in handling collaborative divorces, you may want to consider hiring a therapist to help guide you through emotionally charged issues. You may also need a neutral divorce financial planner if your assets are complex.

The biggest perk about opting for a collaborative divorce is that, even though you will still need to hire an attorney (and possibly additional professionals), a collaborative divorce is most often less expensive than a litigated divorce. You can also avoid the courts for the most part. You will have to appear in court at least once to sign the divorce papers before a judge,

Litigated Divorce

If there is a history of mental and/or physical violence or drug/alcohol use, or if you fear that your spouse is cheating or hiding assets, then a litigated, or traditional, divorce is the solution. Additionally, choose litigation if you cannot reach an agreement on important issues, such as child custody and support and division of assets.

Often, litigated divorces don’t end up in court, as a settlement is reached first. However, many divorces are contentious and emotion-fueled, so negotiations end up in a stalemate. When that happens, the case is moved inside the courtroom and the lawyers change from ‘negotiation’ mode to ‘win’ mode. Court should be a last resort since the judge, who knows very little about the situation, is the one who will be making life changing decisions on behalf of both parties.

Consider all of your options carefully before deciding which path to take to divorce. If you have any concerns about your spouse’s integrity or commitment to cooperation, or if you’re concerned about fair division of assets or custody, then it’s best to play it safe and opt for a traditional, litigated divorce.

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Reducing the Financial Cost of Divorce

Date: September 29,  2014
Author: admin
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Categories: Divorce

Many divorces are too complex for the parties to handle alone. Understanding the combined assets and how they should be split can be overwhelming and complicated, and issues regarding children can be too emotional to take on alone. So lawyers are brought on to help resolve the issues and reach an amicable agreement. Just because a lawyer is required, however, doesn’t mean that the divorce has to be prohibitively expensive. The couple seeking the divorce can do quite a few things to help reduce the financial cost of the divorce so that it doesn’t end up being more of a burden than necessary.

What’s Worth Fighting For?

Every conflict that divorcing spouses have could cost them money. So, it’s in your mutually best interests to individually determine what is worth battling over and what isn’t. It’s natural to be emotional during a divorce, but the most important thing you can do to save money on the process is to negotiate with one another and come to an agreement on everything you can without the aid of a lawyer. Only those items that you consider to be nonnegotiable are really worth paying a lawyer to help you hash out.

Take the Time to Find a Good Attorney

The criteria you use when choosing the right divorce lawyer will include his or her fees. However, attorneys with experience and a good track record can be more beneficial in the long run. They may cost a bit more upfront, but experienced lawyers possess the required knowhow to resolve issues in the best interests of their clients, whether that means their clients end up paying less or getting more.

Additionally, keep in mind that out-of-town attorneys charge for travel time, so location is important. Also, consider whether or not you need a high priced specialty lawyer at all. For example, if you have already agreed on asset division then you don’t necessarily need a pricey lawyer who specializes in forensic accounting.

Efficient Communication

As they say, time is money, and for an attorney, the saying is literal. Prior to communicating with your attorney, whether on the phone, in person, or through email, consider exactly what it is you want to say or ask. Is it imperative, or can it wait? Do you have other questions that can be added to the list? Is your question something a paralegal can answer? Take time to think through all communications because as soon as you have your lawyer’s attention, he is on the clock.

Roll Up Your Sleeves

You may not be able to see the divorce through on your own, but you can certainly be a critical part of the team. By taking on much of the process yourself, you can save significant money on attorney and paralegal fees. By doing little tasks yourself, such as making your own copies and phone calls, and tracking court dates and Court Orders, you will also have a little more insight into the process and, specifically, your own case.

Hire a Mediator

Finally, it might sound counterintuitive to suggest that you hire an additional person when you’re trying to save money. However, hiring a neutral, experienced mediator can literally save thousands of dollars in litigation fees. Some states require mediation, so check with your state court to determine whether you live in such a state.

Getting a divorce is painful enough without the added stress of the expense. But, by following the tips listed here, you can save significant money in fees and costs. That’s money you can use for a fresh start.

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Is a Do-It-Yourself Divorce Advisable?

Date: September 16,  2014
Author: admin
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Categories: Divorce

Divorce is painful, time consuming, and it can be very expensive. However, if you are seeking a divorce that will be uncontested, and it will be fairly simple because there won’t be many assets to divvy up, it is possible that you can save a significant amount of money by filing yourself. A word of caution, though, because there are situations where a do-it-yourself divorce wouldn’t make sense, and, in fact, would be detrimental.

Are You a Good Candidate?

If your family’s assets and debts are straightforward, and you have all of the necessary related documentation at your disposal, then you may be a good candidate. Most importantly, though, it is critical that you and your spouse are in full agreement on all matters, including child custody and support, alimony (if applicable), and division of property. If there is animosity between you, or if you don’t have the time or patience to follow through, then it’s best to seek professional legal counsel.

People You Should Consult

Keep in mind that just because you feel that a do-it-yourself divorce is a good fit for your situation, that doesn’t mean that you will go it entirely alone. There are still several people you should consult along the way to ensure that you aren’t making any missteps. For example, your first stop should be to the county clerk’s office in your state. It’s a good place to start because, while the clerks are prohibited from giving legal advice, they can provide detailed answers to your questions about paperwork and the court procedure.

If you need help preparing and filing the paperwork, it pays to contact a paralegal, or legal document preparer. They cannot give legal advice, but they can assist you in completing the forms and filing them with the court system. The cost will vary depending on your location, as well as other factors, including whether or not there will be a settlement, alimony paid, or if you have children. However, the cost of hiring a paralegal will pale in comparison to that of a lawyer. A paralegal will typically charge under $1000 to prepare and file your divorce documents.

An alternative to using a paralegal is the phenomenon of web-based services. It can be less expensive and a bit more convenient. However, online services are typically geared toward very simple divorces. Before signing on with a web-based service, make sure they are rated by the Better Business Bureau, and peruse online reviews.

Taxes are another consideration when divorcing. Depending on issues like the status of assets, as well as the age and number of dependents, divorce can carry with it some long term tax burdens. So it’s important that you educate yourself. Consider consulting a tax preparer, forensic accountant, or financial advisor who specializes in family or divorce issues. You may be charged for a consultation, so be prepared with information and documents they will need, as well as a complete list of questions you want answered. Seeking tax and asset advice is well worth the time and nominal fee to ensure that you avoid tax penalties.

The divorce process can be very costly, but it doesn’t have to be that way. If you’re a good candidate for a do-it-yourself divorce, and you seek the right support from highly qualified professionals, you can save a lot of money, stress and time.

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The Right Divorce Lawyer

Date: September 09,  2014
Author: admin
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Categories: Divorce

The thought of seeking a divorce is devastating and emotionally draining. When you factor in the prospect of entrusting such an important process to a lawyer who is a complete stranger, the stress can escalate exponentially. So, how can you be sure that the lawyer you choose will be proficient and knowledgeable enough to help you mire through all of the confusing paperwork and legal steps that the process requires? How do you find a lawyer who will ‘get’ you, treat you compassionately, and always keep your best interests in mind? By following three time-tested steps.

Ask Around

No one wants to advertise that they are looking for a divorce lawyer, but speaking with those closest to you is the best way to ensure that you will end up with the right lawyer for your needs. By speaking with your clergy, teachers, close coworkers, friends, family, therapist, or family doctor, you can get some quality, trustworthy leads. Even if they don’t have the name of a specific lawyer, perhaps someone will know of the name of a reputable legal firm or referral center that can help.

Alternatively, your Local or State Bar Association may provide lists of divorce lawyers who are certified in your area. Lawyers specializing in specific areas of law, such as family law, are typically required to pass exams focusing on their specialty prior to becoming certified.

Interview Candidates

The interview process sounds harrowing, but the goal is to identify which lawyer you feel will work best for and with you. There is no set number of candidates to interview, but you should take time to talk to at least three lawyers. Whether your interview will be in person or on the telephone, make sure that you’re prepared with the following information and documents: three years of tax returns, current custodial agreement (if applicable), detailed list of assets, income and debts for both spouses, and timeline of the relationship (include relevant events).

In addition, prepare your list of topics ahead of time to expedite the interview and ensure that you don’t miss any important information. Also, make sure you ask critical questions about how long the lawyer has been practicing family law, how many staff members he or she has, and how many cases they take on at one time. You need to know that your attorney will have enough time and a big enough staff to devote to your case.

Listen carefully to the lawyer’s responses and, if the interview is in person, note his or her body language. Does he seem sincere, or does it come off like a sales pitch? How are the two of you relating to one another? It is a business relationship, but this is someone who will be by your side during one of the most trying periods of your life, so how well you communicate and work together is crucial.

Choose Wisely

After your interviews are complete, take a breather and review your notes carefully, reflecting on each experience. Often one lawyer will stand out well above the others as the obvious choice, however, it’s still important to take your time with the decision. While it is possible to change your lawyer midstream if you end up making the wrong decision, it’s a difficult and exhausting (not to mention expensive) task to have to start from scratch. So, it is obviously better to get it right the first time. After all, your divorce lawyer is one of the people who will be the most instrumental in helping you restart your life.

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