“What are your best tips to be certain I come out of the divorce as financially sound as possible?”
Perhaps the most helpful tip in obtaining financial peace of mind pursuant to divorce is taking the time to establish a realistic post-divorce lifestyle budget. Only when you have that in place is it possible to divide your marital income, assets and debt in a meaningful way. Many individuals will have to face a drastic shift (at least temporary) in lifestyle during the years immediately after divorce. Failing to recognize and accept this can lead to less-than-equitable settlement agreements. Once a realistic post-divorce budget is in place you will be in a better position to identify the marital assets that best align with your goal of being financially sound.
Try and remove emotion from the process of dividing marital assets and debt. Often times, due to the highly emotional aspect emotional aspect of divorce, one may bargain for asset(s) not suited to their post-divorce needs. For example, it is common that the primary home and/or personal property are taken in place of other assets more conducive to securing financial independence (retirement assets, cash, savings, etc.) If you can remove the emotional element from the process and instead take time to understand how each asset relates to your specific financial needs, you will be more likely to improve your financial health post-divorce.
Helpful for couples seeking guidance with financial dilemmas like these would be to obtain the professional assistance of a Certified Divorce Financial Analyst™. Often missing from divorce cases is financial expertise. Today, more and more couples are securing professional advice specific to divorce finances by utilizing the services of a CDFA™. While a CDFA™ is qualified to help work through a host of divorce-specific issues, they are especially valuable in helping couples gain financial clarity with respect to their post-divorce lifestyles.
By using financial and budget information specific to your divorce, a CDFA™ will illustrate the long-term financial impact of numerous settlement proposals. These forecasts help couples better understand their future financial landscapes in terms of cash-flow, net worth and after-tax estimates. Armed with this powerful forecasting tool, couples no longer have to guess regarding asset division and can enter into settlement agreements that best meet their specific post-divorce financial goals.
Adam Waitkevich is a Certified Financial Planner practitioner that founded Divorce Financial Solutions in 2010. Adam is also the President of Stone Harbor Trust, the sister company to Divorce Financial Solutions. Adam is a frequent speaker on investment-related topics and regularly instructs family law professionals in advanced divorce finances.