Divorce happens when a couple grows apart and as a result divorce is the only option. One of the first questions that I am often asked is how much will this divorce cost? The most common answer is that “it depends”, which isn’t a very satisfactory answer for the client or for us as attorneys. The reality is that it depends on you as the client. If you plan to fight all the way to the courthouse it will be expensive and in light of the Covid-19 pandemic will probably take a long time because the courts are closed and even after they open again the backlog of hearing dates will be months out. But there are options to save money by not fighting and get to a settlement sooner than later.
The Collaborative Divorce process can easily lower the overall costs of divorce, but most clients don’t understand quite how a collaborative effort can lower the costs so significantly. The use of a neutral financial professional makes a tremendous difference in reducing costs. The financial professional will cost less per hour than paying an attorney to wade through everything you own and explain the financial components of your divorce.
The Role of a Financial Professional in A Collaborative Divorce Case
When a divorcing couple is working together with a financial professional, they have the opportunity to:
- Understand their budget in-depth and how it will change both during and after divorce
- Determine how they can financially separate and still get by financially post-divorce.
- Develop a post-divorce budget that helps to cover expenses related to the children.
- Develop options for dividing property and dividing retirement accounts
Responsibly creating a financial outline and a budget is a form of damage control. Couples that go through a divorce without prior collaborating often end up facing financial woes they could have otherwise avoided.
Complex Financial Issues
The neutral financial professional is often a CPA or a CDFA (Certified Divorce Financial Analyst). They have special training to understand complex financial issues. This expertise helps you and your soon to be ex to better understand budgets and all of the family’s assets and debts. The professional will develop spreadsheet models and scenarios for the couple to consider during the Collaborative meetings. Furthermore, working with a private professional means that all of your financial matters do not have to become part of the public court records. Everything from dividing retirement accounts, to who gets what percentage of a jointly owned business, and how a jointly owned business will be managed post-divorce is resolved during private Collaborative Divorce meetings.
Overall, the decision that a divorcing couple has to make is whether they want to go to war and all of the costs associated with that war or if they want to work as a team to resolve their divorce case with less cost both financially and emotionally.