FAQ’s

Emotions are flaring, it feels like an emotional roller coaster.

Divorce or separation can be painful!

You are about to embark on a journey filled with decisions — some of which involve financial matters. Making decisions based on inaccurate information will lead to poor financial choices. These choices will affect you for years to come.

Decisions you make during this process may be some of the most important financial decisions made during your entire life.

In the beginning, you will need to build your skills in the financial area so that you can negotiate from a position of empowerment, not on the defense. You can help protect your future financial success by having a divorce financial analyst expert on your team. This will be an emotional transition, but one you can make with confidence once you have the knowledge needed.

Preparation and knowledge are the keys to your success. A Divorce Financial Analyst can help guide you through the decision-making process. Marriage is about love, but divorce is about money, assets, and your financial future. Empower yourself by taking the necessary steps to secure your future well-being.

Expertise

I have several certifications and licenses which each represent a specific area of expertise as an expert in divorce financial analysis.

I have a CDFA designation which is a Certified Divorce Financial Analyst. With this credential, I can help analyze various aspects of your financials during the divorce such as:  short- and long-term impact of potential settlements, potential tax impact of various divisions of assets and assistance with financial affidavits, which is sometimes also called a financial statement.

I have a designation as a MAFF which is Master Analyst of Financial Forensics. With this knowledge and expertise, I can assist with several types of tracing needs, reconstruction of income, fraud investigations, as well as determining unreported income, assets, and expenses.

My CVA is a Certified Valuation Analyst designation that gives me special training to value a business for various purposes. The most common reason I am retained for a valuation of a business is for purposes of divorce. I can also perform a valuation if someone is selling their business, estate purposes, and other specialized matters.

In addition to my certifications above, I am also a Financial Advisor, hold numerous state licenses for sale of insurance products, as well as series licenses for asset management for stocks, bonds, mutual funds, and other investment products and services.

A divorce financial analyst will be an asset on your divorce team. They will partner with your attorney to increase your chances of receiving the most financially favorable settlement. They will ask the financial questions that need to be asked early in the process, review documents that may expose hidden assets or income, and provide financial summaries so that you and your attorney have a better understanding of the financial situation. This will help secure your financial future. Your attorney will handle the legal aspects; an analyst will do their best to assist you to be financially empowered before, during and after your divorce.

The financial tasks a divorce analyst performs are too numerous to list. You and your divorce attorney, through the expertise of a Divorce Analyst, will be able to see the full financial effect and potential tax implications of each proposed divorce settlement offer. This can help to avoid costly delays between you and your spouse in the settlement process. An analyst can explain the financial aspects so that you will be empowered to make educated decisions throughout the proceedings. Many times, complex but crucial information will likely be missed by those without specific divorce-related financial education and experience. With precise financial results, your divorce attorney will be able to back up your position with hard numbers during the negotiating process.

An example of something instrumental an analyst will do is numerically “show” what your marital lifestyle was like. This may be an important factor for the judge when determining the amount support to award. A Lifestyle Analysis will be conducted with the goal of enabling your divorce attorney to justify a support amount, based on the laws and trends in your county, that will allow you to maintain your current lifestyle or something reasonably close to it as possible after the divorce is final.

There are many designations for a financial expert, including: Financial Planner, Certified Financial Planner® (CFP®), Chartered Financial Consultant (ChFC®), Accountant, Certified Public Accountant (CPA), Chartered Accountant (CA), Certified General Accountant (CGA), Master Analyst of Financial Forensics (MAFF), Certified Valuation Analyst (CVA), and Certified Divorce Financial Analyst® (CDFA™).

The role of the financial planner (sometimes they are a CFP or ChFC) is to help people achieve their financial goals regardless of whether they are single, divorcing, or happily married. After determining the client’s goals, the next step is to take an inventory of current assets and liabilities as well as their expenses. The planner then looks at what needs to be adjusted to achieve the client’s goals.

Conversely, an Accountant (usually a CPA) typically looks at the details of the scenario as it is today and does not make future projections. In a divorce, they may be hired to calculate the tax effect of dividing property, an audit of activity or pro forma tax returns. They typically do not look further into the future.

To best meet the needs of divorcing couples, you need a blend of these two ideologies; the CDFA designation was created to fill this need. The role of the CDFA professional is to assist the client and his/her lawyer to understand how the financial decisions he/she makes today will impact their financial future based on certain assumptions. That way, you can make informed decisions about your future. It is in the future projection reports that will show you whether your future is likely to be financially secure or not. Many divorce attorneys welcome a Lifestyle Analysis or complex financial projections that will justify your position at the negotiating table. A CDFA can perform this type of analysis.

A MAFF (Master Analyst of Financial Forensics) can reconstruct, trace, and determine if there are areas on unreported financial information such as unreported income or if fraud is involved. This could be very important in the divorce in addition to the work of a CDFA.

A CVA (Certified Valuation Analyst) will be able to place a value on your closely held business for the purpose of division.

My clients include many types of individuals, men or women, executives, celebrities, professionals, business owners, retail sales, administrative, stay-at-home moms, and more. They all have significant or complicated assets in common, and they want to work with someone who will understand their individual financial needs, and to assist them personally respecting their need for privacy and discretion. I am also hired by attorneys to conduct an analysis of various financial scopes. The scopes may include areas such as valuation of a business, tracing of assets and/or income, projections to assist in determining division of assets, and support needs and calculations of non-marital and marital accounts.

Divorce Dollars is headquartered in Swansea, IL but we serve and advise individuals throughout the United States. We assist not just during the divorce process beforehand but can guide you in the next chapter of your life as well.

All analysis is comprehensive. It may deal with a specific financial issue, but this is not typical. The details can be quite different from client to client, given their own unique set of circumstances. Initially, we will have a strategy session to discuss your case. After that conversation, you or your attorney would retain Divorce Dollars & Sense to work on your case. I will complete a list of documents needed to begin the scope of the work. Various analyses could be completed such as a lifestyle analysis, tracing of assets and income, business valuation, completion of a financial affidavit (Also known as income and expense statements) for the courts. During this process, hidden assets or income may be uncovered. Financial and tax projections will be completed based on any proposed divorce settlements and will be provided to you and to your attorney to back up your position at the negotiating table or in court, if necessary. During the case, other needs may arise, or calculations needed such as present value of an asset, pension calculations, or the value within an account that is marital.

Your attorney will handle all legal matters, legal issues, and settlement negotiations. I will complement your attorney and their needs, rather than compete with your divorce attorney.

In some cases, a divorce attorney may offer to assist you with a Lifestyle Analysis or another financial aspect of your divorce, but he or she is unlikely to have the specialized training and expertise in divorce finances to do so as thoroughly, efficiently, or as cost-effectively as a Divorce Financial Analyst would. I have only met a few attorneys who even have a handle on economics or finance, as either are rarely taught in law school.

When it comes to financial services, CPAs and financial advisors are unlikely to realize what analyses and projections they should create for divorcing clients. Even though many are very competent at what they do, divorce financials are not their specialty. Your CPA or financial advisor may be instrumental for you to use in other areas of your case. Many have not had the specialized training needed to support the financial analysis needed in a divorce case. For example, only 1% of financial advisors have earned the Certified Divorce Financial Analyst designation.

Process

  1. Get copies of all financial records and statements; make a list of assets and debts so you know where the money is and what is owed. Make a list of all banks, investment and retirement accounts with account numbers and their balances. Think about what accounts you have closed or moved elsewhere. Knowing exactly what is at stake financially will help alleviate surprises, hasten the discovery process, save on legal fees, & avoid long delays later. You will want to find a safe place to store everything confidentially.
  2. Obtain a credit report for yourself. If you have an old one for your spouse, make a copy of this document.
  3. If you do not already have one, consider establishing a credit card in your name to help you establish your own credit.
  4. Your attorney may ask you to open a bank account in your own name.

5, Discuss with your attorney about paying down joint debts, the mortgage, or a home equity line of credit. This will relieve your marital stress with reduced debt in the short term but increase your available credit in the future should you need it during the divorce. Depending on your unique situation, there may be other protective measures you need to consider with your debt situation. This would be under the advice of your legal counsel.

  1. If possible, make sure you have enough money set aside for at least three months of daily expenses (especially for house payments if your spouse leaves you). You will need to know how much you need for daily living expenses, and how much is available to you. You may have to adjust your current lifestyle to make sure you and your children can survive financially.
  2. Talk to a Divorce Financial Analyst who can educate you about the basics of money and divorce. They will explain the financial concept of child support, spousal support, and asset division in a divorce. They will assist in analyzing your financial needs under the direction of your attorney. Tactical strategies to prepare for litigation, mediation, or settlement negotiations may be needed. Most importantly, a divorce financial analyst can help you plan for your new beginning and will give you peace of mind.
  3. Consider attending a Second Saturday Divorce Workshop to learn more information about the legal, mental, and financial issues that occur during the divorce process. For more info visit our website at www.secondsaturdayillinois.com. You can also find us on Facebook or Instagram.

This would be a financial expert who is trained to help people navigate through the maze of divorce as the Divorce Financial Analyst on your divorce team. They sift through the financial issues including income, expenses, assets, potential tax issues, pensions, division of property, and debt. I want to help you reach an equitable solution that is fair to both you and your spouse. With this specialized set of skills and experience, we can analyze the financial issues of divorce and calculate the potential long-term and short-term effects. I can look at the offer on the table and project it out 5, 10, or over 20 years to show you what your financial life may look like if you sign the agreement.

No, you still need legal counsel and a judge to dissolve your marriage contract. Rather than addressing your legal situation, a divorce financial analyst will assist you with the financial picture of the divorce. Very few family attorneys have training in financial analysis or financial planning. Divorce may involve very complicated issues such as pensions, retirement assets, stock options, as well as other assets that may have large tax consequences or tax losses. One often overlooked financial issue is future earning potential. Depending on your spouse’s career, their future earnings may increase dramatically. When a pre-divorce financial analysis is created, a projection will show where you may both end up 5-20 years from now. The results can be very eye-opening.

Many clients retain me prior to retaining an attorney. If this is the case, I am happy to recommend several divorce attorneys in your area for consideration. A highly qualified family law attorney is necessary, even in an amicable divorce.

No, you should not make up numbers.

The best starting place is reviewing the past year of spending to determine what your future expenses will be. This task can be extremely overwhelming for most and many errors can happen. This is something that I can assist you with as your financial expert and assist you in completing so that you have correct calculations for the courts. It is very important for this to be as accurate as possible. The courts will use this financial affidavit (also called a financial statement or statement of income and expenses) to assist in determining the need for support and determining one’s ability to pay the support.

Divorce Analysts are not suitable for every case. Sometimes both spouses earn a similar income, have equal earning potential, and hold simple assets in their individual names. Examples of those for whom our services would benefit are:

  • Married for more than 5 years
  • You or your spouse had accounts or a business before you are married especially if they are investment or retirement accounts.
  • Your spouse earns 60% or more of the family income
  • You have assets over $75,000
  • You or your spouse own a private or closely held business
  • You have investment accounts which are not retirement accounts
  • You have debts that will need to be paid off with marital assets
  • You have a suspicion of hidden assets or income
  • You need to determine your spouse’s real income, otherwise known as compensation, especially if you are a business owner.
  • You want to be certain you do what you can to receive your equitable share
  • You are concerned about having enough money for the expenses of you and your children
  • You need a value placed you or your spouse’s assets
  • You are overwhelmed while attempting to complete the financial affidavit the courts are requiring (also known as a financial statement, statement of income and expenses or a statement of assets and liabilities)

The scope of a Divorce Financial Analyst is very broad so there are multiple other reasons why you need one on your team. After a 1-hour strategy session, a decision could be made if we add value to your case.

Yes, especially if someone has complicated assets or a significant net worth, then working with a financial expert can mean a substantial difference in the settlement amount. I have seen numerous times where the proposed offer seemed fair and equitable. After preparing analysis and calculating projections, my affluent clients would run out of money within 10 years and would have to sell their home and move! There is no way to know the impact on your financial future without running this type of financial analysis. Otherwise, it is just a number on paper. Many clients find they feel confident walking into mediation or into a court room knowing what the numbers show. The work a divorce financial analyst provides can be valuable during various points in the process.

Other times, hidden income or assets are discovered after reviewing financial documents which may have otherwise been overlooked! This could result in a higher income for support calculations.

Only if you cannot reach an agreement, then a court date will be set, and a judge hears the case. About 95% of divorce cases are settled without going to trial. These cases are settled by negotiations through family law attorneys, mediation, collaborative divorce, or they are amicable and settled amongst the parties. A judge must approve any divorce settlement or agreement and issue a final divorce decree before the divorce can be finalized. The work of a divorce financial analyst will be very valuable in all areas of divorce from amicable mediation to a court trial.

Clients have found that having an analyst with a skill set such as one of a Certified Divorce Financial Analyst (CDFA) on the team was extremely beneficial during amicable settlement negotiations. Since many clients hesitate to rock the boat by insisting on the amount needed to secure their long-term financial well-being, having it in a report takes the pressure off them.

An analyst who is a Master Analyst of Financial Forensics (MAFF) helps determine if someone is “hiding money” or “hiding assets.” The courts have a difficult time determining if money has been concealed without assistance from a specialized expert in this.

A valuation analyst that holds a CVA designation is a Certified Valuation Analyst. This financial expert is able to value a closely held business for the purpose of division of assets.

Decisions FAQs

I have several certifications and licenses that will assist you.

 

I have a CDFA which is a Certified Divorce Financial Analyst. With this credential, I can help analyze various aspects of your financials during the divorce such short- and long-term impact of potential settlements, tax impact of various divisions of assets, and assistance with financial affidavits.

 

I have a MAFF which is Master Analyst of Financial Forensics. With this knowledge and expertise, I can assist with various tracings, reconstructions, fraud investigations, as well as determining unreported income, assets, and expenses.

 

My CVA is a Certified Valuation Analyst designation that gave me special training to value a business for various purposes. The most common reason I am retained for a valuation of a business is for purposes of divorce. I can also perform a valuation for the purposes of sale, estate, and other specialized matters.

 

In addition to my certifaction above (letters), I am also a Financial Advisor, hold numerous state licenses for sale of insurance and investment products, as well as series licenses for asset management, stocks, bonds, mutual funds, and other investment products and services.

1. Make copies of all financial records and statements; compile you and your spouse’s list of assets and debts, know where the money is and what is owed. Make a list of all bank accounts with account numbers, title of each account, balances, if you have a credit line, interest rates, the type of investments, when they were opened, any closed bank or investment accounts you know of, etc. Knowing exactly what is at stake financially will help alleviate surprises, hasten the discovery process, save on legal fees, & avoid long delays later. You will want to find a safe place to store everything confidentially.

 

2. Obtain a credit report on yourself. If you have an old one for your spouse, make a copy of this document. If you don’t already have one consider establishing a credit card in your name to help establish some of your own credit.

 

3. Consider opening a bank account in your own name and determine what funds you have access to in order to budget for divorce.

 

4. You may consider decreasing your liabilities, such as paying down joint debts, the mortgage, or a home equity line of credit. This will relieve your marital stress with reduced debt in the short term but increase your available credit in the future should you need it during the divorce. Depending on your unique situation, there may be other protective measures you need take regarding your debt situation. This would be under the advice of your legal counsel.

 

5. If possible, make sure you have enough money set aside for at least three months of daily expenses (especially for house payments if your spouse leaves you), and/or for hiring an attorney. You will need to know how much you need to live on and how much is available to you. You may have to adjust your current lifestyle to make sure you and your children can survive financially.

 

6. Talk to a Divorce Financial Analyst who can educate you about the basics of money and divorce. They will explain the concept of child support, spousal support, and asset division in a divorce. They will assist in analyzing your financial needs under the direction of your attorney. Tactical strategies to prepare for litigation, mediation, or settlement negotiations may be needed. Most importantly, a divorce financial analyst can help you plan for your new beginning and give you peace of mind.

 

7. Consider attedening a Second Saturday Divorce Workshop to learn more information about the legal, mental, and finanical issues suring the divorce. For more info visit Second Saturday IL

 

In the beginning, you will need to build your skills in the financial area so that you can negotiate from a position of empowerment, not on the defense. You can help protect your future financial success by having a divorce financial analyst expert on your team. This will be an emotional transition but one you can make it with confidence and knowledge.

Child Support and Spousal Maintenance

It is a court-ordered obligation for a spouse to provide a certain amount of monthly financial support to the other spouse after their divorce. Support was designed to provide the lower income spouse (or one without income) with money for living expenses. This is a legal financial obligation, separate from child support.

Each state will view the need for spousal maintenance differently. (Also called “alimony” or “support”) Keep in mind that no two cases are the same. You need to seek advice to find out how the specifics in your case may impact your ability to receive spousal support. In Illinois, there is a new guideline for determining spousal support. It must first be established if a spouse is entitled to spousal support using various factors. Some examples are shown below. After a determination is made, a formula using the party’s net income becomes the starting point for the amount. Other states have different means to test or calculate support.

Factors:

  • Need – Can you support yourself with your earned income including investment income from the property you receive?
  • Ability to earn income – Does the person who is paying support have enough funds to pay? What is their ability to earn income now and in the future? What is your ability to earn an income?
  • Standard of living – What was the standard of living established during the marriage?
  • Length of marriage – A long-term marriage is considered 10 years or more. The longer the marriage, the stronger the case for support.
  • Health of both parties.

It depends. Your marital lifestyle is one of the most important factors a judge is likely to use in determining a spousal maintenance award; that is why a Lifestyle Analysis may be very important in your divorce cases. It will show validation of your financial affidavit or income and expense statement for the courts.

A Lifestyle Analysis identifies the spending habits of family unit and their day-to-day living expenses during their marriage for the last three to five years. It includes recurring and ordinary expenses as well as unusual and extraordinary expenses. This will serve as verification to the judge of the net worth, income and expense statements submitted by both spouses.

In order to complete a Lifestyle Analysis, all the financial records from that time period must be reviewed. The documents needed are personal and business tax returns with back-up attachment used for tax preparations, investment statements, bank and credit card statements, life insurance statements and credit reports for both of you. It may also be necessary to review business bank records, credit cards and the business “books” to determine additional compensation that funded your lifestyle. It can seem overwhelming at first, particularly if you were not the one in charge of the finances.

All expenses will need to be identified as well as spending you may not have been aware of. During this process spending on a paramour during an affair, concealed marital assets and income, or selling of assets are often discovered. This analysis is very important since it can help a judge determine the amount of child support and spousal maintenance to grant, as well as division of the assets. Once this analysis is completed, you and your attorney will be able to see the lifestyle you and your spouse had established. Your attorney will need this to defend your economic need and refute your spouse’s offer during settlement negotiations and in trial. There may be circumstances in which the lifestyle of either party has been maintained, in which finances were tight or they were living off credit cards prior to separation into two homes. Inf this case, a judge would likely want to be aware of this financial dynamic.

Only the courts can make this decision. If you were in a long-term marriage in which you were out of the workforce for decades, or had an income substantially less than your spouse’s, support may be needed. In the state of Illinois, there are guidelines in place for the calculation of spousal maintenance. Other states will also have a way in which they determine the amount of maintenance to be paid.

Often one spouse, typically the woman, sacrifices their own education and career opportunities to invest her time and labor for her family. Instead, the wife takes responsibility for the household matters, aiding the husband’s career by enabling him to invest time and efforts in his job opportunities and increase the couple’s income. Many wives help their spouses complete school or other training, financially or otherwise.

Unfortunately, many marriages end when the working spouse is at or near the peak of their earning potential. The spouse who sacrificed during the marriage may now be considered unemployable, except in relatively low-paying work. Depending on the award of the assets of the marriage, the courts may find that a spouse needs maintenance to live. This can happen in short-term marriages as well, and for younger spouses. In a division of property, you may receive assets with may produce a form of income for you. This would likely offset the amount of support paid to you by your soon-to-be ex-spouse.

Not in most cases. Even if a couple divides all assets 50/50, over time, the breadwinning spouse is likely to be able to replace the assets they gave up due to their greater earning potential. The other spouse often lacks this earning power. Typically, the other spouse (usually the wife) ends up experiencing the opposite: rather than replacing assets she gave up; she is forced to liquidate her remaining assets in order to maintain anything close to her lifestyle prior to divorce.

The more she liquidates, the more her net worth drops and less is left to sell. If market conditions are not favorable, she may have to liquidate these assets at below-market prices. Spousal maintenance can help equalize this economic disparity. A divorce financial analyst who is a CDFA can assist with projections to determine the short-term and long-term financial effects of the proposed settlements.

Yes, it could change at some point in the future. This is called a modification and they will have to take certain steps through the court system to do so. Many businesses can be cyclical in nature. The business revenue, as well as your ex-spouse’s income, needs to be analyzed to provide a clear financial picture. A business owner may alter their books or intentionally destroy their business in order to reduce or eliminate the amount of support they are required to pay. If this is suspected, I can use various tracing methodologies and reconstruction to see if in fact, the income has decreased, and research potential reasons behind this. Many times, an ex-spouse will continue to ask the court over and over to modify the payments. This will be time-consuming and expensive. Sometimes, this is a means of control for abusive ex-spouses as they continue to abuse through the court system.

If you believe you will be ordered to pay for spousal maintenance, I will work with you to investigate the need for support, and your ability to pay the support. This is done in part by verifying your spouse’s expenses with Lifestyle Analysis. If you are a professional or own a business, we will work together to determine your compensation.

Each state has Child Support Guidelines mandated by that state. In Illinois, it is called parenting time; based on the number of overnights each parent spends with the child(ren). The income calculations can be tricky when one (or both) spouses are an independent business owner who can control their wages and alter their benefits. In this situation, it typically helps to bring in a financial expert like myself who can help determine the true potential income of the party or parties, and the benefits paid by the business. There are other “offsets” to child support that your divorce financial analyst can help calculate.

The child support amount may not cover the children’s actual costs – for instance, extraordinary medical expenses, private school tuition, or extracurricular activities are generally not covered. Speak to your family law attorney about the possibility of increasing the amount to cover reasonable expenses or have them covered by the other parent. Other times, a percentage is covered by both parents depending on the disparity in income. It is very important to carefully review current and future expenses for the children. This is something we can talk through together.

Division of Assets and Debts

In this case, the whole house could be considered marital property. You might have made a “presumptive gift” to the marriage and should consult with a family law attorney to discuss your options. In some states, if your spouse moved into this house, and both of you lived there during your marriage, the house is marital property no matter whose name is on the title.

Pensions and retirement plans earned during your marriage will be subject to division as marital assets. Depending on the state you live in, a portion that was earned before your marriage could also be considered a marital asset. There are different methods of valuation that can be used to determine the marital & non-marital portion of a pension. It may be possible to keep your pension intact and have it offset with other assets. There are some pensions that cannot be divided and therefore must be offset by other assets.

It depends. If you have been contributing to it during your marriage with income you earned, a calculation will likely have to be completed to determine what would be presumed as your “pre-marital” value and the “marital” value. This is something I can do for you and your attorney. It will all depend on the state you are in. If you are in Illinois, the family law attorneys will have me do a calculation to determine both values.

Everything acquired during the marriage, no matter whose name it is in, is typically considered marital property. In some states, the increase in value of separate property could also be considered marital property. If you are going through a divorce, you should evaluate the potential financial drawbacks in having your IRA or your spouse’s IRA included in the list of assets you will retain post-divorce. Remember, the funds in the IRA cannot be accessed before age 59 ½ without paying a 10% penalty for early withdrawal. There is a little-known window of opportunity to access your spouse’s 401(k) funds prior to retirement age without triggering the penalty. I can talk with you about your options. Once this window of opportunity passes, it will no longer be available to you.

This is a complex question…

Many states often differ in the definitions of non-marital (also called separate property) and marital property. Non-marital property typically stays with the spouse who owned it prior to the marriage or received it from someone else as a gift or inheritance… but, there are many ways non-marital property can be inadvertently converted into marital property and therefore, become subject to division between you. This is something that I would need to trace to determine by various forms of analysis if a commingling of funds has happened or a transmutation has occurred.

All property acquired during the term of your marriage is marital property regardless of titling or named owner. For instance: a business you started during your marriage or a 401(k) in your name that you funded during your marriage will both be considered marital property. Sometimes, it can be very easy to divide assets between the spouses.

The more you own it, the more complicated it becomes. Examples of some complex issues are retained earnings in a business, investment accounts, stock options, restricted stock units, real estate investments, accounts that you had before you were married, trademarks and patents stemming from a business owned by one or both spouses. Some assets are worth more than others even if they are valued at the same dollar amount, such a bank account and a retirement account. Different assets have different tax implications when they are liquidated. This will have a tremendous impact on your cash flow. An example of this would be a Roth IRA and a Traditional IRA. Even if they are the same dollar amount, the Roth IRA (if it qualifies) could be distributed tax-free, while the traditional IRA would be taxed at an ordinary income tax rate and have a 10% penalty assessed. It can also make a difference in timing, or when the assets will be distributed. A financial expert like myself can help you understand the true bottom-line numbers.

Note that sometimes a pension can be worth more than a house. It is very important to get a pension calculation from you or your spouse’s plan administrator for the purposes of divorce.

I can assist you in determining if a settlement offer appears financially “fair.” Only the court system can state if something is fair. I specialize in analyzing proposed divorce settlements and how the complex financial factors may interact. Each must be considered so the attorneys can negotiate what is most financially advantageous for you. Even in an amicable divorce, you will need to know which settlement option will provide the best long-term financial security for you and your family.

There are a lot of steps to determine this such as knowing the actual expenses you and your spouse incurred to support your marital lifestyle and various tax and financial situations which may occur based on the proposals we are reviewing. It may show that one spouse may have to liquidate all the assets they own just to make ends meet while the other immediately starts rebuilding their assets and contributes to retirement. This spouse regains their net worth due to their earning power while the other spouse approaches the poverty level. A projection calculation can assist you and your attorney in determining what appears financially fair. You will be better equipped to negotiate a settlement that gives you long-term financial security and allows you to maintain a lifestyle that is comparable to that during your marriage.

A QDRO (or Qualified Domestic Relations Order) is the legal document that divides up a qualified pension or a retirement account such as a 401(k), pursuant to a divorce. The judgment of divorce is not sufficient to divide up qualified plans, so a QDRO is needed. There are many nuances that go into QDROs and make it an advocating (versus neutral) document. To protect your assets, be sure to obtain qualified advice in this area from a specialist. If you do not know of a specialist I can assist with recommendations.

Children

It depends. The tax reform in 2017 changed the “exemption” to “credits.” Several factors would determine who would be best served by taking the child tax credit for the child(ren). Sometimes it can be given to one of you or it can be traded off each year. This is something I can assist with in determining who will receive the greatest economic benefit for the family and make suggestions based on these calculations.

Financials

This is one of the most important and often overlooked questions. The answer is sometimes yes, sometimes no. We would need to discuss what it will cost to maintain the home, including taxes and insurance. The next step is to analyze if there will be enough money coming in to stay in the home. You will want to make sure you are able to pay the bills each month and keep the house maintained. Once this is determined, you can compare retaining the home to buying another or renting. Other factors, such as giving up certain assets in order to pay the bills must also be taken into consideration. All decisions need to be weighed against economic conditions in your area and the effects of the stock market on your investments. Certified Divorce Financial Analysts are trained to help answer this question before you commit to a settlement that cannot be changed. While a house may look nice on a net worth statement, it is not liquid enough to pay the bills. You would be in a much better financial position with that same amount in the bank.

If your spouse has worked and if you have been married for 10 years or more, then you are entitled to one-half of your spouse’s Social Security or your own, whichever is higher – even if you are divorced. Your spouse still retains 100% of their Social Security benefit. This is an automatic guarantee and therefore it is not a negotiation point in a divorce. There are other guidelines for social security payments for a divorced individual. This is something we can discuss together.

Divorce tends to damage women financially far more than men. A study was conducted by Columbia University and Indiana State University professors that found during a divorce; income drops 26% in households headed by women compared to 15% for households headed by men.

The negative effect of this financial situation can reach far into the future. The result is liquidating assets soon after the divorce to pay bills. And the negatively impacted party does not maintain anything close to the lifestyle they lived while married. This means that chances are they will run out of money at some point. It compounds too, as many are forced to liquidate retirement plans during divorce proceedings to pay for legal and other expenses.

On the other hand, husbands that earn substantially more than their wives are often able to rebuild their assets after divorce, including their retirement savings. Therefore, many women find themselves in dire financial straits after a divorce while their ex-husbands, whose earning power is unaffected or increasing, are doing better than fine. I have worked on cases where the wife was the breadwinner of the family and her earning potential far outweighed what he would do in the future, but each case is unique.

Not all divorces are shady, but unfortunately, I have seen quite a few underhanded financial and legal tactics employed by spouses or their divorce teams. These shady tactics support why you need a divorce financial analyst on your team to catch the foul play before it gets too far.

One tactic is stalling and delaying court hearings. They do this with excessive use of motions and requests for evidence with the sole intent of driving up legal costs for you and stretching out the time you must cover your own living expenses. In these cases, the spouse uses tactics hoping the other party will run out of money and be forced to agree to their settlement offer, which is usually unfavorable for them.

Another ploy is taking advantage of the spouse who has not been involved with the family finances—typically the wife. This is a manipulative means of control, even after separation. An example:  the husband ensures that only he can access family funds, cuts his wife’s credit cards off, or moves funds out of family accounts ahead of the divorce, leaving the wife without money for basic needs such as groceries, let alone the ability to hire a competent divorce team to represent her. While this is happening, he hires an excellent team to represent him. Woman may consider maintaining their own emergency fund in a separate bank account, even if they have not yet considered divorce. Unfortunately, many spouses are blindsided by a request for divorce and are left without any funds to support themselves.

Many have attempted to hide assets or income for a reduced divorce settlement or support order, especially in cases where the spouse owns a business or private practice. This will be seen when a Lifestyle Analysis is conducted. This is also when tracing of assets or income is important for the case which I could complete through a forensic analysis.

Even after the judge has entered an order, the high-income earning spouse may fail to pay court-ordered support or refuse to relinquish assets. This leaves the other spouse spending more on legal fees just to retrieve the payments or assets that have already been awarded to them. It is frustrating and unfortunate, but some family courts do a poor job enforcing such orders. This happens repeatedly even when one follows its requirements correctly and the other is deceptive.

There are many areas to be addressed, but it begins with Pre-Divorce Planning. For many individuals, divorce settlement will be the single most important financial decision they make in their lives. Once the divorce is final, you will need to put together a financial plan for your family’s financial goals. I can assist you in the new chapter of your life. We can help you in several areas including roll or transfer your spouse’s retirement and other investments accounts to your own name, look into life insurance on your ex-spouse to secure support payments and assist you by making sure you have done all the judge has asked you to complete.

How do we get started?

The first step is contacting me to set up our strategy session. I want to learn about your situation. At our initial meeting, we will discuss the fee structure for the service provided and give you a list of documents to begin to gather. My fees are often a small percentage of the amount an individual will gain by retaining my services. I always seek to provide excellent value for my clients.