Divorce Financial Analysis
Divorces are messy. When dissolving a marriage, individuals and their attorneys are considering housing situations, child custody arrangements, and financial settlements... all at a very emotional time. That's why it may be beneficial to hire a Certified Divorce Financial Analyst® as part of the team.
Aside from the very immediate physical and emotional changes that occur at separation, a divorce has a huge impact on the current and future finances of both sides. Not only does it cost more to maintain two households instead of one, but it may now require more financial resources to meet long-term goals such as retirement.
Kate Downing, a Certified Divorce Financial Analyst®, can assist the client and their attorney in the following ways:
- Compile a Net Worth Statement for the individual and their attorney, detailing existing accounts, assets, and liabilities
- Help the individual build a post-divorce budget and identify any areas of financial strain
- Discuss the tax implications of various accounts, and provide a tax-related adjustment for better comparison
- Work with the divorcing individual to clearly identify their financial goals post-divorce
- Analyze the impact of a proposed settlement and provide projections to the client on how it would affect them both now and in the future
- Provide a life insurance analysis, if any alimony or child support payments should be protected through life insurance on the payor
- Ensure that the terms of the settlement agreement are completed post-divorce and that assets are properly moved as agreed
- Assist the individual with post-divorce actions such as updating beneficiary designations and creating a new financial and estate plan
In some marriages, one spouse takes primary responsibility for the finances. While this is understandable, it can leave the other spouse in a difficult situation when trying to analyze their current finances. Additionally, it's hard for any individual to understand how this will affect them post-divorce without detailed financial planning. Unfortunately, we don't know what we don't know - having an extra professional on the divorce team, focusing solely on the financial implications, can help the divorcing individual feel confident that they understand the financial impact of the final settlement and have a clear path forward.