Category Archives: Recently Divorced?

Top 3 Estate Planning Actions to Take During or After Divorce

Perhaps no life event imposes a more significant – and urgent – need to update an estate plan than a divorce.  A divorce generally causes a radical change in both personal finances and family dynamics; in nearly all cases, both the husband and wife no longer want the ex-spouse to be a beneficiary to the other’s  estate plan.  If children are involved, the need to protect and provide for them following a divorce is of paramount importance.

Many people incorrectly believe that a divorce automatically cancels out the estate plans that were in place prior to the divorce.  With this in mind, Leslie V. Marenco, attorney with Marenco Warshofsky Padron Rodriguez & Marrero, Pshares the top three action items to consider immediately with regards to your estate plan:

Revoke Your Will/Trust

Start by revoking your old Will and drafting a new one.  If you don’t have a Will, now is the time to design one.  The same applies if you made a living Trust while you were married.

A Will is where you:   1) Leave your property to the people you love; 2) name an executor to wrap up your estate when the time comes; and 3) nominate a guardian to take care of young children, should it be necessary.  All of these choices are affected by divorce.

If you’re like most people, you made a Will while you were married and left all your assets to your spouse, which is likely not the result you want now.  It’s best to start fresh with a new Will, naming new beneficiaries and alternate beneficiaries.  Be cautious of leaving anything directly to minor children as they do not have the legal capacity to own and manage assets.

Name a Guardian for Minor Children

If you are a parent with young children, your estate plan should begin with a foundation that ensures your children will always be taken care of by the people you want and in the manner you would like.  Having the necessary documents in place for the day you can no longer be there for your family is certainly important for everyone; however, for families with minor children, it is a necessity.

Think about it:  if the unthinkable were to happen to you, who has the authority to take care of your children in an emergency situation?  How about for the long term?  Who can make medical decisions for the children, if you cannot?  The last thing any parent wants is for their children to end up with Child Protective Services while an emergency situation is sorted out.

Update Beneficiary Designations

As important as your Will or Trust is, it might not cover some of your most valuable assets.   Many assets pass outside of a Will or Trust to beneficiaries named on paperwork provided by a bank or insurance company.

A plan administrator must turn funds over to the beneficiary named in the plan documents.  So if your former spouse is still the named beneficiary, her or she will inherit those assets.

Going through a divorce is a major life event that can leave you feeling battered and bruised.  Understandably, the first thing on your mind during this difficult time is likely not your estate plan.  Yet, this is the time when you absolutely need to update or create an estate plan.

My Kids’ Divorce Post Mortem

“So Dominic, what do you think about your mom and I getting divorced?” He paused for a second and responded, “Well, dad, to be honest with you, this makes me the 15th kid in my class whose parents are divorced.”

It was January 8th, 2009, and my wife ushered Dominic and Lucas into the living room to inform them that we were ending our marriage. When they heard the news, the boys started laughing. They both thought it was a joke; they were totally blindsided. And why not, they never saw a glimpse of a broken marriage.

And just like that, my 24 year marriage came to an end; Dominic went outside to play hockey; and Lucas stormed off to his room. At that instance, I should have realized that each son would manage this life altering event very differently. But, of course, I was too caught-up in my own emotions to have it register.

Now, just over seven years later, I decide to go back in history and see what the boys thought about the divorce. How they felt? What they hated the most? What they learned? And, most importantly, how their lives changed because of the divorce. The idea of conducting these “interviews” was terrifying to me, but I moved forward. I was not sure how Dominic and Lucas would react to my idea. Happily, they agreed to my proposal.

As you might guess, based on Dominic’s initial reaction to the news, he moved on quickly. Given his practically, Dominic looked at the whole thing as just a speed bump on the road of life. Although he was naturally sadden, he reasoned that being with each parent at different times would be no big deal. After all, he hardly recalled a situation where he need both of us at the same time for anything.

Lucas on the other hand had a very different reaction to the same news–anger and extreme sadness. Sixteen years old at the time, this was the first really bad thing to impact Lucas’ young life. He took refuge in his music; listening to artists whose work reflected what he was feeling inside. To this day, Lucas, a musician, credits the divorce for exponentially expanding his musical spectrum.

As to what Dominic and Lucas hated the most of their post divorce world, they were in unanimous agreement: 1) The bickering between their parents; 2) The moving between the two homes. At times, both felt as if their parents were acting like kids and they were the adults. And although their rotation between houses was one week at a time, they still hated the packing and moving every Friday afternoon.

“Intergenerational transmission of divorce” is the phenomenon that those who experience a parental divorce are significantly more likely to divorce themselves. It’s very well documented and backed by tons of research and data. So, naturally, I wonder if the boys were somehow jaded about relationships and marriage.

Lucas is looking forward to a day when he’s married and has children. In his parents, Lucas recalls two individuals that did not share many common interests. “You need to have major intersections with your spouse,” said Lucas. “I saw you and mom and not sharing much of a life, professionally or otherwise. I don’t want that in my marriage.”

For Dominic, the divorce was the start of a new chapter. He was only 13 when we divorced. His post-divorce life allowed him to grow up in a very different environment than he was accustomed too. Part of this transformation began with my move to a section of Miami known as Brickell. The closest thing to New York in Miami, Brickell served as a platform for Dominic to explore and grow as an individual. “For me, it was a new life. I experienced many new things and grew up,” shared Dominic.

To my amazement, the divorce fundamentally changed Lucas, and in a positive way. The event was actually constructive for him; something he’s built upon. “Before the divorce, I was self-centered and narrow in my points of view.” reflected Lucas. “Post divorce, I become empathetic. I could really feel others’ issues and problems and help them. I’m now a much better listener.”

I know this has not been easy on my boys. I’ll never forget the day tensions boiled over between Lucas and me. As I came to understand, the disruption in his life was just too much to handle. Since that low point, I believe the three of us have made great strides. I credit the divorce with making me a much better father. And if for nothing else, the painful journey was well worth it.

Divorce is typically a long and complicated process, with children’s lives many time held in the balance. Divorce touches many aspects and is not just a legal matter. There are a multitude of things to consider — before, during and after. But no matter, I hope my story will help to keep your children’s best interest at the forefront of all your actions.

I truly regret the bickering and anger with my ex-wife, but that is but a faint memory. Now, I look forward to a life for me with two find young men that I proudly call my sons. And having conducted these interviews, I’m elated to see that Dominic and Lucas built positively on this awful experience.

For those of you considering divorce or currently going through the process, I wish you the best. Divorce can be long and painful. But you can minimize a conflictive divorce through personal education, reflection and empowerment.

The Emotional Side of Divorce

The Divorce Matters column regularly focuses on the “business” side of divorce. However, as we all know, divorce is a highly emotional process. With this in mind, I sat down Jerome H. Poliacoff, Ph.D., a Coral Gables-based psychologist, to discuss the emotional aspects of divorce.

TBK: What are typical emotional and psychological responses during each phase of divorce?

POLIACOFF: All three phases—before, during and after—can be disabling emotionally. When spouses marry they usually do so thinking they are going to be married forever. So becoming unhappy and thinking about divorce can be immobilizing. Regrets about marrying their current spouse or how to tell the kids about the divorce lead to a roller coaster of emotions. When one partner gets the courage to tell the other, the first stage is over. Then comes yet another hard part, which is the reaction from the partner who either isn’t aware or doesn’t want to divorce.

TBK: What’s the best manner to tell children about a divorce?

POLIACOFF: Probably the most important thing to do is be on the same page and tell them together. It’s vital to be honest with your kids and not critical of your spouse. This can be especially difficult when there have been hurtful events, such as infidelity, but with a little diplomacy, you can avoid playing the blame game. Give your children the benefit of an honest, but kid-friendly, explanation:

  • Tell the truth.  Your kids are entitled to know why you are getting a divorce, but long-winded reasons may only confuse them.
  • Say “I love you.” Letting your children know that your love for them hasn’t changed is a powerful message.
  • Address changes. Preempt your kids’ questions about changes in their lives by acknowledging that some things will be different now, and other things won’t.

TBK: Can you share the five stages of divorce and the associated psychological states?

POLIACOFF: The stages follow Kubler-Ross’ description of the five stages of grieving after the death of a loved one – in divorce it goes something like this:

  • Denial: “This is not happening to me. It’s all a misunderstanding. We can work it out.”
  • Anger and Resentment: “How can he [she] do this to me? What did I ever do to deserve this? This is not fair!”
  • Bargaining: “If you’ll stay, I’ll change” or “If I agree to do it [money, child rearing, sex, whatever] your way, can we get back together?”
  • Depression: “This is really happening, I can’t do anything about it, and I don’t think I can bear it.”
  • Acceptance: “Okay, this is how it is, and I’d rather accept it and move on than wallow in the past.”

Understanding these stages can be very helpful when it comes to talking about divorce and decision making. It’s important to know that when you are in the early stages of this grief and recovery process, it can be challenging to think clearly or to make decisions at all, much less to make them well. Identifying your present stage of grief and being aware of it is an important step toward ensuring that you will make the best choices you can.

TBK: In cases where one is blindsided by the divorce and still in love, how should they manage the resulting emotions?

POLIACOFF: That’s not an easy question to answer. It depends in large part on who the person was before the divorce, their strengths and weaknesses, the presence or absence of a support system and how they have historically managed anger and loss. If you keep in mind that whatever you’re feeling now is not how you will feel forever it may help you get through the next moment, hour or day.

Jewelry Appraisals

As we all know, some divorces can be long and highly contested. In such cases, some people just “want to forget the whole experience” and even wipe away the memory of their marriage. Such was the case with our client, Betty. For Betty, the first step to putting the marriage behind her was to sell her wedding ring. But to who? How? To answer these questions and others, I turned to Jon Bragman, a certified appraiser with years of gemological and valuation experience.

TBK: What is the process of getting jewelry appraised?

BRAGMAN: The process is simple once you have found a qualified appraiser. The appraiser should be available to come to you. Whether it is a bank, office, or home, the appraiser should work with complete client privacy. Having the appraisal done at your location insures that no property leaves its place of safekeeping. There should be no need to leave any property and clients should always be welcome to watch the appraisal process. The fee for the appraisal should never be based upon the value of the jewelry.

TBK: You speak of a qualified appraiser. What exactly makes an appraiser qualified?

BRAGMAN: An appraiser is a skilled professional with expertise in both the subject matter being appraised; as well as, thorough training in valuation science, and experience with the market place for the item in question. It is important to understand that the designation Graduate Gemologist (GIA) does not indicate appraisal training or ability. GIA (Gemological Institute of America) provides training in gem identification, diamond grading and colored gemstone grading of loose gemstones. GIA does not offer training in appraisal methodology, market research, ethics, the Uniform Standards of Professional Appraisal Practice (USPAP) compliance or report writing. Only specific appraisal organization designations can provide any assurance of the appraiser’s qualifications. Always seek an independent jewelry appraiser. The appraiser should have years of experience; be properly insured; provide references; show work samples; and be a member of one of the major appraisal organizations, such as NAJA, ASA, AGS, or ISA.

TBK: What does an appraisal involve?

BRAGMAN: An appraisal is an opinion of value for a particular market on a particular date. It is usually in document format, describing all qualitative and quantitative attributes necessary to arrive at the value conclusion. The appraisal should also include photographs of the items appraised. We have all heard the expression that a picture is worth a thousand words. A quality appraisal should be typed, not hand written, and done by an independent jewelry appraiser, not by the seller or store where the items were purchased.

TBK: What options exist for selling the jewelry once appraised?

BRAGMAN: The options are simple. Once the jewelry is inspected, appraised or evaluated, the options become clear. The item can be sold, or, in some cases, brokering the jewelry might be an option. Long term brokering does not apply unless the items warrant the use of a well known auction house. Short term brokerage is measured in days, allowing a broker to get several offers for the jewelry. Once the best option is determined, be sure that your buyer/broker is properly insured (if you are allowing them to hold your jewelry), the items are documented properly, and your agreement is clearly outlined with acceptable prices and the costs involved. Quite simply, know exactly what you are getting into. Experience and professionalism will always show.

Divorce Support Groups Can Help

I often get asked about the value of divorce support groups and where one can find such a group. Going through my divorce, I only wish that I would have attended such a group. Post divorce, I came to understand the value of not going it alone. It’s with this mind that I spoke with Adriana Linares. A divorcee herself and a volunteer, Adriana leads the Miami Divorce Support Group in Coral Gables.

TBK: What is the purpose of your group and how does one sign-up?

LINARES: The purpose of the Miami Divorce Support is to provide a support for anyone going through a separation or divorce. The group started at Granada Presbyterian Church. I was a group participant five years ago, and then I was asked to lead the group in 2012. The non-denominational group is a safe place where people can come to share, learn, and get through the process of separation or divorce. People can sign-up at www.meetup.com. However, not everyone joins us through Meetup. A lot of people come referred by others, or find us through the church’s website (www.Ganadapca.org). It is NOT a requirement to be part of Meetup or attend the church in order to join the group.

TBK: Why do people typically join the group?

LINARES: People typically join the group to find support, guidance, and to learn from others going through the same situation.

TBK: What type of support does the group provide?

LINARES: We provide two types of meetings. On the second and fourth Wednesday of each month, 6:30 PM to 8:30 PM, we meet for regular support group meetings. In these meetings, we have an informal open discussion setting where people can talk, share, and listen to others. It really helps people to have a safe environment to be heard and to feel understood. On the first and third Wednesdays of each month, 6:30 PM to 8:30 PM, we provide a course called DivorceCare (www.divorcecare.org). It is a structured class with a video, a workbook, and group discussion. The course covers 13 different topics, and it gives people perspective, wisdom, and tips for getting through a separation or divorce. The course is provided year-round, and people can attend at any time throughout the course because each topic is standalone.

TBK: What are the different needs of members according to their process; say, someone in the divorce process versus another that’s recently divorced?

LINARES: We have found that there are generally three groups of people: 1) recently separated; 2) in the divorce process; and 3) just divorced. Each group has different needs, but all have to grieve the loss of the relationship, the marriage, and everything associated with it. Those recently separated are assimilating the news; and trying to face the reality of what happened. They are normally confused about what are the next steps to take; what outcome they really want; and how to deal with this new reality. For those in the divorce process, they have to deal with the lawyers, their spouse’s responses, and issues of asset separation, money, and child custody. Once divorced, people have to accept that divorce is final and deal with issues of starting over, both emotionally and financially. A sad reality is that many people in our group, both men and women, are also dealing with the pain of infidelity. These people need help with self-esteem, forgiveness and understanding that their spouse’s actions do not define who they are. Overall, our goal is for people to know that they are not alone during these difficult times.

Divorce Discrimination

As if we needed another form of discrimination, now, we have divorce discrimination. I take that back; this type of discrimination has been around for years.

A few weeks ago, I was planning an event for my company. I’ll spare the event details, but the invitees are all socially connected, upper middle class, divorced individuals. While looking for a venue, I came to understand that local developers are now staging events in their model units, free of charge. This is actually a smart marketing move, as it showcases the property to prospective buyers in a non-invasive manner.

So I reached out to one of those developers. The location was perfect for the event and the price was even better. Thinking that the event’s invitees were a perfect audience for the property, I figured the developer would jump all over the opportunity to host our high-profile event. I was dead wrong!

I was told, “divorced people are not the type of individuals that we are trying to attract.” No, I kid you not; this is what I the lady on the phone said. So, I took a deep breath and asked who they were looking to attract. The young lady proceeded to describe exactly what I was bringing to the event: socially connected, upper middle class, individuals.

Long-term marriages are ending at an astonishing rate of almost 75%. This means there are many divorced people–mothers, fathers, grandmothers and grandfathers–looking to downsize into the carefree condo life style. And many in the silver- divorce demographic are exiting divorce with plenty of disposable income.

But the young lady on the phone would not have any of it. She was not divorced and likely in her 20’s. Boy has she got a lot of learning to do, and so does that developer.

My point: divorce discrimination exists, no doubt. Thinking back, prior to my divorce, I also discriminated against divorced people. I saw them as failures, and I felt sorry for their poor kids. Although I never came out and said it, I did not want to associate with those divorced. I was happy, or so I thought, in my Coral Gables, white picket fence, married life bubble. Just like that young lady, I had a lot to learn.

Seven years removed from my failed marriage, I’m happily divorced. My two boys survived. I live in a condo, travel and love life. My post-divorce experiences are just as enriching as those I had during my married years, if not more. Today, I have countless divorced friends.

Divorce is not a disease; not a race; not even a status on a tax return. Divorced people are all around us: contributing to society, raising great kids, and meeting lovely new spouses.

Come to think of it, I have virtually no married friends. Could it be that married couples are still practicing divorce discrimination? Are you?

Caring for Children After Divorce

With minor children, post-divorce arrangements and caring for children are most often a challenge; for both the children and the parents. To discuss this topic, I had a conversation with Crystal Roland, Esq. of the Merrick Park Law Center.

TBK: How are timesharing and parental responsibility determined?

ROLAND: The court must order shared parental responsibility unless the court makes specific, detailed findings supported by evidence that shared parental responsibility would be detrimental. Shared parental responsibility means that the parents confer regarding major decisions. Upon making the appropriate findings, the court may order sole parental responsibility over all or specific areas of the upbringing. Currently, there is no presumption for or against a specific timesharing plan with either parent, but instead the court considers multiple statutory factors in establishing what timesharing plan is in the best interest the children. Some of the factors the court will consider are, among others: 1) Ability of each parent to encourage a close and continuing parent-child relationship; honoring the timesharing schedule and being reasonable with changes; 2) Extent to which parental responsibilities will be delegated to others; 3) Ability of each parent to determine and act upon the needs of the child as opposed to their own; 4) Geographic viability of the plan; and 5) Reasonable preference of the minor children, if the children are of sufficient intelligence and experience to express a preference. Should the parties fail to reach an agreement approved by the court, the court will order a parenting plan that will award parental responsibility and timesharing.

TBK: What are the typical timesharing arrangements and factors to keep in mind when agreeing to such?

ROLAND: Parenting plans should structured, detailed, and drafted to meet the unique needs of the family and children. Typical factors to keep in mind for regular, non-holiday timesharing are: 1) The ages of the children and their needs in terms of school, activities, and any special needs (medical, emotional, social); 2) Parents’ work schedules; 3) Geographic distance between the parents in relation to schools and activity schedules; 4) How summer and holiday time will be spent; 5) When and where the exchange of the children takes place; 6) Communication times and methods for the non-timesharing parent to contact the children; 7) Acceptable travel outside of the United States; 8) Any other issues unique to the family or issues of importance for religious, cultural, moral or other reasons.

TBK: In today’s mobile society, where people move for jobs, how are parental responsibility and timesharing rights affected?

ROLAND: If a party with timesharing rights wishes to change their residence more than fifty miles, for at least sixty consecutive days, from their residence at the time of the last order or of filing, the party must petition the court for permission to relocate unless the parties reach an agreement. The sixty day period does not include a temporary absence for vacation, education, or the provision of health care. In such cases, the parties need to consider a parenting plan that addresses parental responsibility and timesharing post-relocation. In other words, distance alone usually does not translate into the non-relocating parent being unable to be involved in major decision-making. The parent physically with the children at any given time, regardless of distance, normally retains to right to make the day-to-day decisions relative to the needs of the children during their timesharing.

Annuities and Divorce

I just came across a case where an individual purchased an annuity shortly after the divorce, and the decision did not make financial sense to me. It seems to me like individuals of “silver divorces” and annuities are often linked, which is not always a good thing. To delve into this very important topic, I reached out to Jennifer Failla, a Certified Divorce Financial Analyst and Principal of Strada Wealth Management.

TBK: As a financial vehicle, what exactly is an annuity?

FAILLA: An annuity is an insurance product, which serves as investment account that pays out income in the future. Typically an annuity is used to save for retirement or to generate a consistent stream of income in retirement. Basically, an individual makes an investment in the annuity, and it then the annuity pays the invidiaully in the future. There numerous kinds of annuities. The one that is right for the client depends heavily on their goals: saving for retirement or income in retirement.

TBK: What is the financial rational for buying an annuity?

FAILLA: If an individual is saving for retirement and is in what’s termed the “accumulation phase” of earnings, an annuity can be very beneficial. The individual can take before or after-tax dollars and shelter the growth in a deferred annuity until ready to distribute the money. With the latter goal in mind, annuities can provide a stable source of income in retirement. How much an individual receives depends on whether the investment was for a guaranteed payout (fixed annuity) or a payout stream determined by the performance of the annuity’s underlying investments (variable annuity).

TBK: As it pertains to divorce, when does an annuity make sense?

FAILLA: In divorce cases, annuities are good to consider when an individual needs guaranteed income now or in the future. An applicable case would be if one of the spouses receives a lump sum of cash and is able to take some of the cash, invest it, and defer gains in order guarantee a steady stream of income later. The key here is that there needs to be sufficient money so as to maintain the desired standard of living now, taking into account that the money moved into the annuity will not be available.

TBK: What should a divorced person consider before buying an annuity?

FAILLA: While annuities can be useful retirement planning tools, they can also be a bad investment choice for some people. The first thing to consider is fees. Fees within annuity contracts can be very high and hard to decipher, making it very difficult for an individual investor to net a return without taking additional market risk or giving up control of the money. Secondly, be aware that annuities are most often sold by insurance agents who profit significantly in commissions. Finally, no one can predict what will happen in their life, so having access to their own money without penalty is a consideration—liquidity, especially in the case of divorce, needs to be calculated carefully.

 

A Personal Story of Divorce

Often the most moving and inspiriting stories and those that we learn the most from are those told by the people living the experience. With this in mind, I set out to find a person of divorce willing to share details of their divorce experience. Janet (not her real name) is client of The Big Kaboom. Two years since her husband asked for the divorce, Janet is almost at the finish line. Janet was kind enough to share lessons learned along her divorce journey.

TBK: When you were confronted with divorce, what were the first thoughts that came to your mind?

JANET: Divorce is perhaps the scariest seven-letter word one can attempt to process. Life as I knew it was, in fact, over. In retrospect, I suppose the first thoughts were, “This is catastrophic.” “How am I going to get out of this financially and emotionally intact?” I was scared of the unknown because divorce is something that I never even imagined happening to me. I quickly realized that I knew what I didn’t know. So I needed a support system, if I had any chance to deal with this rationally and keep from coming undone.

TBK:  As with everything in life, we learn from experiences.  What’s been the biggest learning experience from your divorce?

JANET: Be proactive, not reactive. You have to take control of your divorce process and make informed and rational decisions. It’s up to you to direct the team of professionals you put in place to look after your divorce. Ask questions. Challenge what you are told. Understand that only you have your best interests in mind. As much as possible, you need to remove the emotion from the process because being out of control hinders your decision making ability. As I’ve come to understand, this is the biggest business negotiation of my life, and I must treat it accordingly. You can’t sit back and wait for things to happen to you. You have control and power of choice.

TBK: If you had a divorce “do over”, what would you do differently?

JANET: I would take less advice from friends and family, and more from people who have actually been through the process. Unless you’ve been through divorce, you have no idea how long, complicated, expensive and convoluted the process can be. Whatever I envisioned at the start does not even come close to reality.

TBK: Now that you are almost done with your divorce, what advice can you share with those thinking of or moving forward with divorce?

JANET: First, while divorce is perhaps one of the toughest experiences one can go through, you can do it, and you will be okay. For all its pain, the growth and sense of freedom to be gained from standing on your own financially and emotionally is truly a gift. Second, there are great people out there to help you swim to the other side. You don’t have to go it alone, and it’s a little crazy to try. Especially when so many people have successfully made it through divorces and are standing strong with relevant experience to be shared and learned from.

What’s Missing and What’s it Worth

Often times in divorce, determining the whereabouts and value of marital assets become highly contentious issues.  And when this situation surfaces, the hiring of a forensics accountant or accounts is a critical next step.

To delve into this subject, I sat down for a chat with Philip J. Shechter.  A Litigation Support Partner at Cherry Bekaert, Phil has more than 30 years of experience supporting clients in commercial litigation and marital dispute resolution cases.  Phil is also a board member of Matters of Divorce.

TBK:  Once the need for forensics accounting work is determined, what is typically the next issue to address?

SCHECHTER:  Usually, it’s agreeing on the need for one or two CPAs.  Traditionally, in a divorce, each side hires a CPA to determine the separation of finances. As a result, dueling accountants are likely to disagree and present differing sets of facts, numbers and assumptions, increasing the likelihood of a trial.

TBK:  Is there a practical way for divorcing couples to get around this potential roadblock?

Phil:  To combat the issue, more family law attorneys, as well as judges, recommend hiring a single, neutral CPA.  A neutral CPA can collect documents and make inquiries of both parties without the filing of discovery motions.  There is generally no need to depose the neutral forensic accountant.  Professional time usually spent at hearings on discovery issues may be eliminated completely.  The neutral CPA can determine income and expenses, prepare a schedule of assets and liabilities, and value businesses and other assets where necessary.

TBK:  How does a neutral CPA work with the attorneys for each party to the divorce?

SCHECHTER:  First and foremost, each lawyer must have their client’s authority to request forensic accounting services from the neutral CPA, in whole or in part.  In addition, the neutral CPA should be certain that both parties’ attorneys are fully satisfied with the terms of the client-attorney-CPA channels of communications for the engagement.  The neutral CPA will generally provide scenarios with ranges of numbers to allow some flexibility to the parties to negotiate a settlement.  Providing financial alternatives, where necessary, allows the attorneys to represent their client’s perspective and to do their job.

TBK:  What are the advantages of employing a neutral CPA?

SCHECHTER:  Hiring a neutral CPA may help to reduce the expenses of the divorce.  The biggest savings may be realized by avoiding the costs of having a trial. Oftentimes, cases involving an impartial accountant can be successfully settled at mediation.  At mediation, the neutral CPA assists the mediator by presenting different financial options during the negotiations.

TBK:  Sounds like an ideal solution, but there must be cases where a neutral CPA is not the best course of action.

SCHECHTER:  For sure there are.  In order for the arrangement to work there must be some trust between the parties. Marriages with a history of domestic violence or that are destined to become a “War of the Roses”, for instance, typically are not good prospects. Foremost, at a minimum, the parties must agree up front to provide the neutral accountant all requested documents.