If you are considering a divorce, in the process, or post agreement, there are so many financial issues you need to think about and address. Along with all the other emotions that come along with divorce, navigating the financial path, can cause substantially more stress. Our objective is to minimize if not eliminate that added stress!
Our financial services practice can help guide you step by step through navigating the financial challenges as it relates to divorce.
Most people who engage in the divorce process often find themselves overwhelmed, confused, anxious and not knowing what professionals to seek and when. Attorneys are usually the first, and many times the only professional providing advice. While attorneys are great at what they do, their knowledge pertains to the law, not necessarily all the complex financial issues that can be found in many matrimonial cases. For this reason, we recommend our clients work with a dedicated team of professionals. This team should include at a minimum, a matrimonial attorney, certified public accountant, and a financial planner.
We work with several matrimonial firms who rely on us to assist their clients. A great attorney knows the importance of working as a team with other professionals who are all aligned for the best interest of their client.
Below are just some of the important items we review with our clients and their counsel, if applicable.
- Cost benefit analysis of splitting assets that have different tax consequences. For example, should you split a pension vs. giving “credits” from other assets such as a home.
- Short and Long term effects of splitting property
- Analyzing potential tax liabilities depending upon how assets are divided
- Cash flow analysis – For example, whether someone can afford to live in the marital residence.
- Life insurance - coverage amount, ownership, beneficiary designations, and cash value distribution.
In addition, there are several other areas of concern we address with our clients.
If you have children
- Think about updating your Will to include a Trust.
- Name a conservator.
- Name a trustee.
Discuss with your attorney having these papers drawn up prior to the completion of the divorce process. This is not something you want to put off and risk forgetting!
Reviewing your Will or Living Trust
Your spouse may be the executor/trustee and may also be the sole or primary beneficiary of your estate. Is this still your intention? Incidentally, many states abide by an elective share statute, meaning that a spouse (whether estranged or married) is automatically entitled to a percentage of your estate.
Durable Power of Attorney
- Think about revoking it so it cannot be misused.
There have been instances where a DPA has been used to take out loans in the name of a spouse or to transfer a spouse's assets to the other party.
Health Care Proxy
You may want to have it revoked. If you ever became incapacitated, you may no longer want your spouse making health care decisions on your behalf.
You might own joint property or assets
- Qualified retirement plans, like a 401(k) or a 403(b)? Should you consider a QDRO (Qualified Domestic Relations Order)? This is a court order that divides pension rights between divorcing spouses.
- See that titles and deeds are appropriately transferred: cars, boats, campers, motorcycles, and other vehicles, homes, rental property, vacation cabins, other real property types.
- Bank accounts and credit cards - You may want to change joint accounts to individual accounts and remove your name from your spouse’s accounts.
Running your credit
- Pull your credit report.
- Check all accounts to assure their validity.
- Contact creditors to cancel or close accounts, to change contact information, or to remove your spouse’s name entirely.
The process we’ve developed and refined enables us to work with our clients and their other trusted team members to work towards better organization and efficiency.
We’ve witnessed too many people making hasty financial decisions during their divorce process. Years later, their haste ultimately proved regrettable.It’s critical you make intelligent financial decisions during all phases of the divorce process. And we’re confident in our knowledge and abilities to help you pursue the best possible outcome.
We look forward to hearing from you..