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Preparing for Divorce

rosemary • Jan 25, 2017

You have decided this divorce needs to happen. Now what do you do? Prepare yourself. The following are some steps to take before you pull the trigger and set things in motion.


Take care of deferred needs like dental work, new eye glasses, replace the tires, fix the roof, etc. Money is going to get tight, real soon, so better to know these things are taken care of.


On the other hand, you will need to save some cash for the expenses of the divorce process:  hiring professionals like a financial advisor, attorney, and therapist to help you get through this painful and complex process; possible moving expenses; replacing household furnishings, etc.


Copy all financial documents of any kind that you can access safely. Put copies in a secure place, preferably under lock and key, maybe at work or with a friend. This includes bank statements, credit card statements, credit reports, retirement accounts, pensions, investment accounts, tax returns and all accompanying documents required to prepare the returns.


Open a new bank account for yourself at a bank not previously used by you or your spouse. You will need a place to safely deposit money without having it be accessible to your soon-to-be-ex-spouse. This is only to assure that funds are available when you need them, not to conceal funds. Expect to properly disclose this account during the divorce process.


Check your credit report and assure that you have at least two credit cards registered individually to you in your own name. If that is not the case, apply for what you need now and provide total household income information on the application.


Begin to see a therapist, if you are not already doing so, to help you through the decision-making process, as well as the divorce itself, and ultimately recovery. There is no such thing as “tough it out” when life gets downright painful. Remember, therapy is private and confidential. The only one who will tell anyone else is you.


Schedule an initial consult with a divorce financial advisor to share specifics of your financial concerns and get some preliminary indications of what you should be considering.


Interview attorneys for legal perspective as well as identify what will matter most to you regarding the qualifications and personalities of an attorney with whom you can feel confident and comfortable. This will become a very personal relationship and you may require some specialized legal expertise, like military benefits, domestic violence experience, children with special needs, etc.


Research all professionals whom you are considering hiring for your divorce with particular attention to whether they have proper licensing, have they ever been subject to professional disciplinary action, and practice reputations. For instance, if your desire is to have an amicable divorce, you do not want to hire a pit bull attorney. If you want to have solid financial advice, do not hire someone who does divorce math as a hobby because they themselves had such a painful divorce.


Read all you can to prepare, but remember, there are just as many poor writings out there as there are good. And very difficult to tell the difference. Choose only reputable publications or websites to read, attend any live workshops in your area where presenters are willing to expose themselves to scrutiny, rather than hide behind an anonymous webpage.


This should get you off to a good start for what will not really be a good experience. However, commend yourself on seeing that where you are now is not good either, and a divorce will lead you to a better situation.

Dependent Children and Tax Benefits

By rosemary • 21 May, 2018
The conversation regarding which parent should claim the children as dependents has changed dramatically since the recent tax reform, effective January 2018, eliminated the personal exemption. Yes, that $4,050 (in 2017) tax exemption per child is gone. Parents will not even get that exemption for themselves. This is causing extensive confusion among attorneys and clients alike. The Parenting Plan template has not been revised to reflect this and still contains an entire section dedicated to which parent will claim the exemptions. The new answer to that is Neither one. However, other tax benefits related to child dependents have gained new importance and must be taken into consideration when negotiating which parent claims the children as dependents. The overall goal is to maximize tax benefits between the parents and minimize combined taxes paid and the financial needs of either parent. The primary residential parent will be able to file as Head of Household and take advantage of th...

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By rosemary • 28 Dec, 2017
The most significant tax reform in thirty years was signed into law December 22. With barely a week to understand how it impacts all open and future divorce cases, it became effective January 1, 2018, unless otherwise noted. Many of the provisions have sunset dates, upon which rules will revert to pre 2018, unless extended.Alimony, beginning January 1, 2019, will not be tax deductible for payer, nor taxable to the recipient. Modified orders, after that same effective date, will adhere to the previous tax deductible/taxable treatment in the original orders, unless it is specified in the modification orders that the new not deductible/not taxable treatment will apply. Although the effectiveness of this dramatic change has been delayed for a full year, we will need to pay attention to it immediately for any active cases that are not expected to conclude before December 31, 2018.Tax Brackets have been adjusted more than normal annual inflation adjustments. Some for the better, others not s...

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By Rosemary • 09 Nov, 2017
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By rosemary • 24 Mar, 2017
I am often asked for attorney referrals by potential clients embarking on the divorce process. My usual response is that I am better able to make referrals after meeting with you, understanding something about your situation, what you prefer in the way an attorney will represent you, and getting to know you is a limited way. Even after all that, I will provide at least three names of attorneys for you to interview, assess and make your own best decision.An attorney is not a commodity. This is a person with whom you must feel comfortable and about whom you must feel confident. You will need to have some of the most personal conversations of your life with this person and subsequently trust them to literally represent your best interests in a way that you wish to be represented. An unreasonably pugnacious attorney will make you seem unreasonable and pugnacious. Is that really how you want to appear to a judge? Even if you do not go to full trial, there will be brief court hearings during...

Your Financial Advisor's Role in Your Divorce

By rosemary • 17 Oct, 2016
What assistance can you expect from your current financial planner or advisor during your divorce? The short answer is "None." Your divorce presents a clear ethical dilemma and/or conflict of interest for your current financial professional. They must simply "sit it out," wait for the divorce to be finalized, then resume services, if you wish them to do so. Whether they realize this, or acknowledge as much, is up to them. However, this message is to help you make more informed decisions regarding whose advice you seek during divorce.The best thing you can do for yourself is to hire an objective Divorce Financial Planner, who is a licensed financial and investment professional, as well as a divorce specialist. Verify their credentials: check their public record on BrokerCheck.FINRA.org and/or AdviserInfo.SEC.gov websites; confirm their divorce financial qualifications. As an investment professional, your Divorce Financial Planner will be familiar with the characteristics and nuances...

Financial Abuse is a Form of Domestic Violence

By rosemary • 29 Sep, 2016
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Do You Like Money?

By rosemary • 01 Sep, 2016
Since divorce will force you to make the largest financial decisions of your entire life, so far anyway, it is probably a good time to examine your relationship with money. Do you like it? Really? Then why don't you have more of it? These are meaningful questions because, like marriage and divorce, money is something that is highly emotional.Our relationships with money date back to early childhood and initial experiences with money, be they positive or negative. Think about how money was regarded in your family of origin and how that has impacted you to this day. Maybe money was a taboo topic, maybe it was something there never seemed to be enough of, maybe it seemed to cause all the other problems in your family, maybe there was plenty of it but still caused all the problems in your household.Let's go back to my original question: "Do you like money?" The likely answer something like, "Of course, everyone likes money!" Then why, when you get some, do you immediately think of what you...

Is All Disappearing Money Dissipation?

By rosemary • 29 Jul, 2016
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Divorce and Credit Cards

By rosemary • 31 May, 2016
In addition to your marriage being an emotional relationship, it has also been a financial partnership. Now that you are divorcing, be sure you get a financial divorce as well. To complete the process, all three credit reporting agencies must reflect your new individual financial status.Early in the divorce process, pull up to date credit reports from each of the three credit reporting agencies: Equifax, Experian, and Transunion. All three are necessary because they likely will have differences in their reported content and you want to be sure to cover everything. It would not serve you well to have two accurate credit reports and encounter a prospective lender in the future who depends upon the third for their determinations of your credit worthiness.Your purpose should be two fold, identify those accounts that need to be "divorced" and assure that you will have at least two individual credit cards, of your own, post divorce. You may have developed habits during the marriage of thinki...

Five Ways to Financially Prepare for Divorce

By rosemary • 29 Apr, 2016
Financial issues will dominate the discussion of your divorce settlement. Therefore, it makes sense to prepare financially for divorce. You are preparing not only for the actual expenses related to the divorce process, but also for the major financial adjustments that will follow. (For those of you who were looking for ways to hide assets, this is not where you will find it.)Taking the following financial steps will help you be better prepared, financially, for the divorce process, as well as the outcome. But remember, in spite of all your preparation, there will still be difficult times ahead.Save money. Forego as many unnecessary expenditures as possible and save funds to pay for your divorce team of professionals: therapist, financial advisor, and attorney. You will need the assistance of these experts, who help people like you through divorce on a daily basis, just to understand what is happening to you and what to do about it. Divorce is like no other life experience and to try t...
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