March 16, 2017. By Ashley Agnew:

The process of divorce can be described as emotional, exhausting, and even tumultuous.  Couples who are fortunate to sustain an amicable experience throughout the entire process are a rarity.  By the time the day comes to sign an agreement, many find themselves in a rush to sign anything just to close this chapter of their life and move on past the stress it can cause.  Decisions made during these final days, however, are crucial to post-divorce well-being and require fiduciary guidance as they will dictate the future of an individual’s financial well-being.  If you find yourself at the beginning stages of arranging a settlement, are unprepared for the confrontation that awaits you, or would rather not navigate the financial confusion on your own, now may be the time to engage a Certified Divorce Financial Analyst (“CDFA”) on your behalf.

Although your attorney may be fluent with basic financial terms and have great legal finesse, they are not to be confused with financial professionals. In addition, the financial professional you use for investment management may not be familiar with the types of calculations needed to ensure a fair and equitable agreement. A CDFA on the other hand, is well-practiced in just that. Not only will he or she have the investment background to recognize which elements of the agreement need to be altered to suit your long-term needs, they will also be able to walk you through all the language of your decree, agreement, and qualified domestic relations order (“QDRO”).  In addition to collaborating and supporting your divorce attorney, A CDFA often can help with the following:

  • Determine the short and long-term effects of dividing property
  • Analyze pension and retirement plan assets
  • Identify tax issues
  • Help divide a business interest
  • Project estimated inflation rates and rates of return
  • Evaluate insurance needs (health, life, disability)
  • Determine if you can afford the marital home or must seek a more affordable alternative
  • Collect financial and expense data
  • Help you identify future financial goals, such as developing a budget, setting retirement objectives, and identifying proper asset allocation
  • Provide your lawyer with the financial impact of a settlement to be used as support

At Centerpoint, we are fortunate to have many resources that help us guide our divorcing clients. In addition to the CDFA accreditation earned by Managing Principal Jennifer Wolfsberg, our Director of Financial Planning, Olga Okaty, is a Certified Financial Planner™ CFP® professional and a member of the Financial Planning Association.  Together they can formulate the monetary needs and goals, backed by a formal financial plan, to support the negotiations of your divorce attorney. The addition of another professional to the process may seem cumbersome, however instead it will ease the stress on all parties involved and assists the client in understanding how many of the today’s decisions will affect their lives long after the agreement is signed.  Here is what the typical divorce process may look like:

New clients are often referred to us after they have signed their final divorce agreement (a document which is difficult to amend) making it hard for us to help optimize their support or agreement.   The goal of course is always to respectfully consider the mutual goals of the parties. With such a delicate situation, a CDFA and CFP can assist with making smart decisions during a time where emotions are heightened and navigating through a myriad of difficult decisions is overwhelming.