When you set out to get married, you don’t envision your spouse going from hero to zero or that the financial focus would ever shift from flowers and cake to who keeps the house or gets the labradoodle. Unlike the newlywed stage, you might not have your finances or life in alignment when getting divorced and that’s pretty normal. Sometimes all you can focus on is maintaining a semblance of peace and beginning the healing process. In order to prepare you for the divorce process and protect your assets, here are some helpful tips to consider when embarking on your financial planning after divorce, including how to reduce costs.
Agree before you disagree
Before meeting with a lawyer, it could be beneficial to craft a list of everything you agree on with your spouse, including decisions related to investments and your estate. If you can agree on a few key points on your own, this will make the rest of the process flow much more smoothly. This saves time, energy and money down the road. See if a trusted friend could act as a mediator. Each spouse can send an email with the top 5 priorities to that friend and see if there is a way to meet in the middle.
Remember, that whatever you feel you are “losing” of “giving up” could become nothing more than a mental cost. Once you both get lawyered up, you have left the realm of rationality and have entered the contentious stage. Unless you and your spouse agree not to go down this road, it could very quickly turn into an adversarial and costly tit for tat.
Do I need a divorce lawyer?
There are circumstances where heading to court may be the only option, but it is a last resort after exhausting other tactics. There are many options you can choose from before you get to litigation. Some alternatives include mediated negotiation, settlement, or the best for saving money, a collaborative divorce. Choosing to have a collaborative divorce can reduce fees and stress by resolving issues between you and your partner in a more human, less “legal” way.
Attorney or divorce financial planner?
A divorce financial planner is a great alternative to a divorce attorney who has a price tag out of your range or who you don’t feel is the right fit.
Just like in dating, the first match might not always be the best match or the one you decide to stick with. There are always more options, including both spouses agreeing to hire the same attorney which will most certainly save a significant amount of legal fees. But at a time when the trust level is likely at an all-time low, focus instead on a disinterested 3rd party without any family connections that could potentially cause bias or conflict of interest. Professional divorce financial planning helps ensure everyone gets a fair deal, all while costing less than a lawyer. Consider a divorce consultation with A CDFA (Certified Divorce Financial Advisor), a financially neutral third party that can often help you both save a substantial amount of money.
Keep things amicable (if possible) at all costs
When getting divorced, keeping things amicable WILL LOWER COSTS. Meditate, exercise and see a therapist! All of these may help keep your head stay clear and reduce your expenses.
When a couple decides to get divorced, they may have a preconceived notion that it has to cost them thousands, be adversarial and take a long period of time to process. This isn’t the case and doesn’t have to leave you worse off than when you started. By keeping things respectful and friendly, you could save thousands of dollars on attorney fees and court costs.
If the friendly part seems insurmountable, take an extended separation to breathe and focus on family. Don’t rush into another relationship looking for a band-aid or move to another state (unless required by work or family)! Heck, you could even draft a pre-divorce agreement together. Once you get it signed and notarized, it will provide you each with a rulebook to erase any grey areas of confusion.
In some cases, you can even get divorced for free. If you avoid court and lawyers altogether and simply file a petition which your partner accepts, the back and forth can be completely eliminated. Filing fees add up quickly when you engage in a battle over your disagreements.
If it truly is the end of a marriage, we can help you move forward with your new chapter in life. Demand Wealth can help you regroup and restart with our ‘Demand New-Beginnings‘ portfolio that is uniquely aligned with each stage of divorce. For more information, schedule a video consultation with one of our advisors.
This article was written by Tori Preast with contributions from Demand Wealth’s founder (and divorcee), Brandon Mink.
This report is a publication of Demand Wealth. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author as of the date of publication and are subject to change.