Category Archives: Thinking of Divorce?

Financial Moves Before, During and After Divorce

If there is one recurring theme in our business, it’s the number of clients that enter and exit the divorce process without a sense for financial matters. To delve into this topic, I had a conversation with our Divorce Care Network member, Caridad Vasallo, a CPA and partner in VMBG Accounting.

TBK: Prior to filing a divorce, what financial actions are a must?

VASALLO: There is approximately one divorce filed in the U.S. every 36 seconds. However, what this statistic fails to address are the parties’ lack of inclination to understand financial matters. That is why I recommend that the first step taken is to understand what they own and owe. It is recommended that you obtain a minimum of one year’s worth of information. Next, understand your monthly expenses. This will not only help you with completing the financial affidavit required during the divorce proceedings, but it will also aid in setting funds aside for necessary daily expenses and anticipated divorce costs. Protecting your credit during the divorce process is also critical. Start by obtaining a credit report for yourself and your spouse. Identify what joint liabilities are held, and work to lower the balance on the debt in order to maximize your availability to credit in the future. Also, begin to build your credit by opening individual accounts, and close accounts held jointly.

TBK: What are some of the big mistakes you see made going into the divorce process?

VASALLO: Since divorce is such an emotional time, people tend to want to hurry through the process in order to reach the next phase in their life. However, this creates unrealistic expectations by the parties and can become a big mistake in the long run. Most parties think they will reach a settlement within the first few weeks or months of filing their petition for divorce. This is not always the case. On average, a divorce will take approximately 10.7 months to finalize.

TBK: Once the divorce is finalized, what are the major financial actions to take?

VASALLO: A divorce decree does not preclude you from updating your last will and testament. You must notify your estate planning attorney of the divorce, and request that they update the last will and testament to reflect your new desires after your passing. Additionally, you must notify financial institutions and third parties of the divorce. This means updating your health insurance, changing the title on the deed to your home, updating beneficiaries, and don’t forget your social media accounts. The marital settlement agreement will state terms that must be executed within a certain time frame. Take the time to re-read the agreement, and outline what items you are responsible for executing and the items that belong to you ex-spouse. The divorce can also require you to find a new group of professionals. Sometimes one spouse’s relationship with a specific financial planner, attorney, or accountant was stronger than the other spouse’s relationship with them. After the divorce, assess whether you continue with the pre-existing professional team you utilized during the marriage, or if it’s time for you to seek new professionals. Lastly, meet with your accountant to determine the tax implication of the marital settlement agreement. For example, if you are receiving alimony, consult with your accountant in order to estimate your quarterly tax payment obligations.

Disadvantaged Divorcing

We seem to always hear about the mega rich divorces. You know, those cases where the legal fees and magnitude of the financial settlements can boggle anyone’s mind. But at the other side of the spectrum, how do the economically disadvantaged get divorced?

Yes, there are many couples that cannot afford to get divorced simply because they can’t come to grips with the possible reduced standard of living post divorce. And there are couples that don’t want to spend the money on legal fees to get divorced. But what I’m talking about are individuals, particularly women, who simply don’t have the money to file for a divorce.

For many in this situation, long-term separation is the most obvious way out. An article by the American Sociological Association highlighted a study indicating that married couples who undergo long-term separations generally appear to be those who can’t afford to divorce. And of these, about 80% of the respondents reported that their marriage ended in divorce, most within three years.

But this option is a challenge in states, like Florida, where separation is not recognized. Therefore, even if physically separated, a couple is still married in the eyes of the law. This is a potentially dangerous situation, as one could be liable for the actions of a spouse who they don’t even live with.

So if you are poor, how exactly can you get divorced in Miami-Dade County? Given the financial situation, obviously, retaining an attorney is not an option. It turns out that the only real viable option is with the help of The Family Court’s Self Help Program. With a trip to the self help center, $495 and the completion of various forms, you can file your own divorce. But for many economically disadvantaged this last resort represents several challenges.

First is the time required to miss work for the visit downtown. There are no reservations, no online option and long lines at the self help center. For many in a difficult economic circumstance missing work for the visit is a challenge to say the least.

The second issue is the $495. For many of us, this is no big deal, but when you are below the poverty line, this could be the rent payment. And you cannot get the divorce packet and receive the filing assistance afforded by the program without paying the required fee.

Finally, you have the issue of the forms. These are legal forms that are difficult to understand and complete. Even after the purchase of the divorce packet, the self help center provides little assistance with the forms’ completion. The role of the center is to help individuals with the procedural aspects of representing themselves before the court.

At our company, we often come across this situation with callers looking for free or low-cost divorce options. Sadly, most of these callers are women financially stuck in a really bad marriage. They simply don’t have the time, money or skill to get divorced via the resources of the self help center.

To overcome these challenges, we created The Divorce Angel Fund. As part of this initiative, our company works with local family law attorneys and paralegals for the completion of the legal documents required for a divorce filing. The fund provides the money to program recipients for the payment of their legal fees.

The Divorce Angel Fund is exclusively self-funded by the company. However, to increase the fund’s scope, we anticipate the conversion of the Divorce Angel Fund into a non-profit in the near future. If you are interested in learning more about the fund or how you can help, please call or email me.

Poverty and divorce are linked on many levels, and it’s a problem that simply won’t go away because we don’t hear about it.

Divorce: A Case of You Don’t Know What You Don’t Know

Nothing causes more apprehension than the fear of the unknown. And there is the kicked in the gut feeling of under estimating a situation. Divorce is like that on both accounts.

Emotionally, divorce is hard enough. But that’s not all that is difficult. Divorce involves dealing with issues–many times in not the best frame of mind–that are foreign. Many people enter the process unprepared for the divorce marathon. Depending on your stage, here are some things to think about.

Thinking About Divorce

  • Child Support. The amount of child support awarded is in accordance with Florida statutes, which take into account the net income of the parents and the number of children. Also factored is the financial ability of the parents to pay the determined amount of child support. There are many child support calculators available on the Internet, which may serve as guide.
  • Alimony. Once the need of one spouse for support and the ability of the other spouse to pay are determined, many factors are considered in the final award. Pay no mind to what your friends and family tell you about “who got what in their divorce”.
  • Financial Awareness. During the divorce process, you will need access to financial documents and information. Do you know where these are? If you lack this information, you could be at a disadvantage in understanding your potential, future financial situation.
  • The Process. The process can be long and there is more than one way to get divorced. Educate yourself on the process and the alternatives best for you.

Moving Forward with Divorce

  • Selecting Divorce Professional. Attorneys, mediators, financial advisers; they all work for you. Select providers that match your personality, objectives and pocketbook.
  • Staying in the Home. The marital home belongs to both spouses. As noted in our interview of Gil R. Izquierdo, a Miami-based family law attorney and mediator, only under certain circumstances must one of the parties leave the house.
  • What to Keep and Give Away. Marital property belongs to both parties. So, in a divorce these “things” need to be split between them. This is equitable distribution. It could be wise to decide early on what’s important for you to keep and the financial ramifications. Getting professional help in this area is important, such as from a tax professional.
  • Focus on the End Goal. The average divorce lasts a year, which means yours could take longer. With any long process, it’s easy to lose focus and react to things. Early on in the process, determine your goals and the strategy. Forget what your soon to be ex does or says and what people tell you. Sooner or later you will be divorced, and you will live with your actions and the outcomes for the rest of your life.

Recently Divorced

  • Asset Separation. Property, vehicles, IRAs, pension funds, bank accounts–the list can be long–getting these separated and titled correctly as soon as possible is a very good idea.
  • Insurance. If you were covered by your spouse’s medical plan, now you need your own. For the possibility of prolonged illness, consider long-term insurance. What about life insurance for you in the benefit of your children?
  • Change of Beneficiaries. Imagine if you pass and the proceeds from your IRA or a life insurance policy go to your ex-spouse and not your children, for instance??
  • Trust/Will. After a divorce, these documents could take on an even bigger sense of urgency. Any single person with assets titled in their sole name should consider a trust, especially where minor children are involved.

Considerations for Saving a Marriage

Nobody gets married thinking they are going to want a divorce later. Yet almost fifty percent of married couples end up considering a split and the rate of divorce has more than doubled in 40 years.

But just because you’re thinking about it, doesn’t mean it’s inevitable. How can you tell if you should call it quits or if your marriage can be saved?

Sometimes a marriage can come back from the brink of divorce.  But only if both spouses are willing to put in the sweat and tears that it will take to repair any damage and reach a resolution.  Marriage counseling has been helpful to millions and saved countless unions, but both partners need to be on board for it to be productive.

Naturally, whether or not a marriage can be redeemed depends on the conflict between the husband and wife and/or the reasons why it is failing.  But like with most things, there are some common threads:

  • No Pressure, Now.  Almost always, the common thread for unhappy spouses are unmet expectations. You are shooting yourself in the foot if you set unrealistic expectations of your partner and even of yourself. If you do or already have, be willing to adjust those expectations.  They don’t call it the “honeymoon stage” for nothing.  As a marriage matures, so do people.  Things change and personalities evolve.  There will be “good times and bad times” and sickness and health.
  • Communication is Key.  A wise man once said marriage is one part commitment and three parts communication skills.  This means more than the ability to speak.  Most important in a marriage is the ability to listen and to understand your spouse’s point of view on issues even when you disagree with or, worse, dislike their perspective. Good communication in a marriage means being able to not only speak the truth but hear the truth, which can be more difficult to do.  If a marriage is going to be saved, both partners must feel safe to freely say whatever they feel they must say without the fear that it will be held against them.
  • Learn To Compromise.  If you really want to save your marriage, that means that your spouse is still important to you. So it should be easy to make adjustments and compromises to keep the peace. “This is usually harder than it sounds,” says psychologist Dr. Jerome Poliacoff, PhD. “People instinctively find a need to defend themselves – their positions, their answers, their values – when confronted with an opposing view or thought. But think about it this way: is it more important to be right about where the remote garage door opener was or is it more important to save your marriage? Sometimes you have to learn to let things go.”
  • Stand by Me.  Conversely, you must know when to hang on. A marriage is probably the most important commitment one makes in life and that means that you don’t run for the woods at the first sign of trouble.  Or the second.  Or the third, even. “Divorce is not such a bad thing when it really is the resolution of a marriage that needs to end because everything else has been tried,” Poliacoff says.

If you are both committed to make it work, willing to compromise, able to adjust your expectations and if you can each promise to speak freely and really, truly listen to what your spouse has to say, your marriage just might make it.

Cohabitation and the Law

There seem to be misconceptions with regards to the legal rights of couples that choose to live together and not get legally married. On the surface cohabitation seems to be a panacea for many couples, but it’s not as easy as that. To separate fact from fiction, I discussed the topic with family law attorney Rhonda S. Goodman.

TBK: Many people that I speak with believe that the State of Florida recognizes cohabitation as a legal family status, is this true?

GOODMAN: Every marriage in Florida is to be solemnized under a license. As a result, Florida does not recognize common law or de facto marriage as valid.

TBK: Given that the State of Florida does not legally recognize cohabitation, what should couples in such relationships do in order to protect themselves?

GOODMAN: The couple should consider entering into a cohabitation agreement. It is a contract that can establish rights and obligations that are not afforded by law because of their unmarried status. It is similar to a pre or post nuptial agreement. It creates a framework in which the couple can structure their finances and relationship. A cohabitation agreement can also prepare the couple for events such as death, illness and separation. It can be used to address a wide range of issues including day-to-day finances, asset and debt allocation, and support. Estate planning, beyond the preparation of a last will and testament, are also important.

TBK: What are the ramifications for child support, parental responsibility, and timesharing in a cohabitation relationship in Florida where the couple have minor children in common and never signed a cohabitation agreement?

GOODMAN: Child support will be determined pursuant to Florida Child Support Guidelines, a mathematical calculation based on both parent’s income. A parenting plan should be established including parental responsibility and a time-sharing schedule. It will govern each parent’s relationship with the minor children. The best interest of the children will be the primary consideration. If they are a same-gender couple, there is usually a legal and non-legal parent. The non-legal parent may have no legal rights to the children. The parents may reach an agreement outside of court.

TBK: Agreement or not, what are the legal rights of a party to spousal support or alimony in Florida, if they’ve been in a long-term cohabitating relationship?

GOODMAN: If they have an agreement, the legal rights should be determined pursuant to the agreement. Absent such an agreement, there may be no legal right to spousal support or alimony in Florida to an unmarried party.

TBK: In Florida, if the relationship is ended by one of the parties, what happens to any assets or liabilities acquired during the cohabitating relationship?

GOODMAN: If there is no cohabitation agreement in place, the parties are left to come to an agreement as to the distribution of their assets and liabilities or turn to the courts. The parties can follow Florida law in the equitable distribution of their assets and liabilities similar to in a divorce.


Child Support and Other Expenses

Our article, “Who Pays for College?”, prompted several emails inquiring as to other considerations to keep in mind where divorce and children are concerned.

Child support is naturally the first one that everyone thinks about. The Florida divorce law statute stipulates that parents have a legal duty and moral obligation to support and educate their children, which includes providing them with adequate food, clothing, shelter and the basic necessities of life. The amount of child support awarded is in accordance with the child support guidelines, which take into account the combined net income of the parents and the number of children.

The child support obligation continues until a child is no longer dependent on the parents. A dependent child is one who relies on the parents for support. The reasons for the dependency could be: 1) the child is under the age of 18; 2) the child has a mental or physical disability that prevents self-support; 3) the child is in high school, between the age of 18 and 19, with a reasonable expectation of graduation before the age of 19.

But keep in mind that there are several other child-related expenses normally considered outside the scope of child support. In these cases, a determination needs to be made as to what expenses will be paid and how much will be the responsibility of each parent.

One of the most important of these is medical-related expenses for a child. Who will pay for the medical insurance premium and for what type of coverage? When one spouse is covered by a major medical group policy through their employer, this is usually not a major issue. However, such is not the case if one or both spouses have individual medical insurance policies, as the coverage may be very expensive. And there are the costs of co-pays and deductibles to consider as well.

Another large expense is private school. Assuming both parents agree on the need for a private education, the cost of tuition needs to be accounted for. And keep in mind other school-related expenses, such as uniforms, field trips and tutoring, among many others.

Finally there are the expenses related to extra circular activities and camps, which can be significant depending on the types of activities. Alone, participation in sports can mean expensive league fees and travel team expenses. And we all know how expensive away camps can be. And the younger the child at the time of the divorce, the more these expenses amount over time.

Generally speaking, there is no set formula as to who will pay for what expenses and how much. It all boils down to a negotiation with regards to what percentage of the expenses each parent will pay. Of course, the parent with the greater income will likely pay for a larger portion of these expenses.


The Thought of Divorce

With the divorce rate holding steady at about 50% and skyrocketing to over 70% for baby-boomer couples, there are many walking among us that are contemplating divorce.

Still, once this thought enters our head, many of us feel as if we are the only ones in this situation.  Of course nothing could be further from the truth.  People contemplating divorce often share the same fears and concerns.

In cases where children are involved, the biggest worry is on how to tell the kids about the divorce.  It’s never easy to talk to the kids about divorce, whether they are still young or already out of the house.  It is common for children of all ages to mourn the loss of their parents as a unit.  It’s natural for them to wonder what this means in their day-to-day lives and to their quality of life.  As parents, we are naturally very concern about the ramification of the divorce on our

Past telling the kids, the most prevalent concern is around the finances of the divorce.  As sad as it may sound, one of the first questions most people ask themselves when considering a divorce is not why or when — or even who.  It’s how much is this going to cost me?  Anyone who has been through a divorce can tell you that the pain and grief associated with the death of the marriage can soon make way for the stress and anxiety associated with the potential or real loss of financial stability.  So, properly understanding the finances of divorce is paramount in reducing the fear of moving forward.

Then there is naturally self-doubt.  Am I making the right decision?  As with any major decision, second guessing is common.  And in the case of divorce, it can be a healthy exercise.  Sometimes a marriage can come back from the brink of divorce.  But only if both spouses are willing to put in the sweat and tears that it will take to repair any damage and reach a resolution.  Just because you’re thinking about it, doesn’t mean divorce is inevitable.

But with a decision to move forward with divorce, trust quickly immerges as a major concern.  Who do I tell?  Where do I get the support and information that I need?  How do I move forward?  This is critical juncture.  Decisions taken or not taken at this point will no doubt have a big impact on how the divorce progresses.  Slowing down, thinking through the process and getting the proper help are all musts.

Change is never easy.  The unknown scares us.  It’s only when the burden of the current situation outweighs the fear of the unknown that we take make changes.  An unhappy marriage is no different.  Education and understanding are the biggest keys to dealing with the fears and concerns associated with divorce.  But rest assured that like others before you and after you, your apprehensions about divorce are natural.


I’ve Fallen and I Can’t Get Up

Two years ago Nancy discovered that Frank had an affair; she forgave him for the sake of the marriage and the children.  Fast forward two years and Frank is having another affair, this time with one of Nancy’s friends.  Enough is enough.  Nancy is looking for an attorney to help end their 19 year marriage and that’s when I get “the call”.

In talking with Nancy, it became clear that she is not staunch in her resolve to move forward with a divorce.  Actually, she was contemplating yet another reconciliation.  Most people might find it incredible that Nancy could be so forgiving or so naive, yet this not the first time I’ve encountered this kind of client behavior.  And, this behavior is not unique to women, as men can also behave the same way.

I’ve encountered spouses in situations similar to, or worse than, Nancy’s, where one of the spouses never follows through with the divorce.  They consult with us; agree to see an attorney; visit with the attorney; and then they do absolutely

What causes a person to act this way?  What leads a woman, or man, to stay in a marriage that is clearly earmarked for divorce?

To help me answer these questions, I called upon my good friend, psychologist,   Dr. Jerome Poliacoff.  Jerry is a captivating storyteller.  Speaking from his years of working with spouses like Nancy, Jerry explained the reasons in stories and vivid examples.

“You know Carlos, we are all a product of  the  influences of our upbringing,” Jerry tells me.  “When it comes to divorce, people look at it through their unique lenses, which are shaped by their life experiences.”

According to Jerry, there are there are six primary justifications for staying in a bad marriage.

  1. Shame.  It’s not unusual to have someone stay in a marriage to avoid the stigma and shame associated with a failed marriage, even in today’s society.
  2. Lifestyle.  For some, the lifestyle enjoyed during the marriage is too much to give up.  As is likely, a divorce will almost always result in a reduced lifestyle for one, or both, of the parties–some people simply can’t accept that outcome.
  3. The Known.  People are creatures of habit, and change and the unknown are deathly scary to them.  These individuals can rationalize that it is better to accept the known problem than risk an unknown solution.
  4. Children.  Likely one of the poorest reasons for staying in a bad marriage, many individuals don’t divorce mistakenly believing that it’s best to stay married for the sake of the kids.
  5. Self-Esteem.  Spouses with low self-esteem will stay in a bad marriage, no matter how bad it gets.
  6. Religion.  Depending on the depth of their faith, for some people divorce is simply not an option.

Jerry also makes the point that these factors are not mutually exclusive.  In other words, a combination of these factors may keep an individual holding fast to a bad marriage.  The more factors that can be justified, the stronger the case someone can make for avoiding a divorce.

Child Support Calculation — Guidelines and Example

Child support is money paid by one spouse to the other for the support of their children.  The amount of child support awarded is in accordance with the child support guidelines (Florida Statute 61.30), which take into account the combined net income of the parents and the number of children.  Factored into the final award is also the financial ability of the parents to pay the determined amount of child support.

Included in the child support guidelines is a schedule that is used to determine the child support need, according to the number of children that parents may have, ranging from 1 to 6.  The other component to the schedule is the parent’s combined monthly net income, ranging from $800 to $10,000.  For illustration purposes and to work on a hypothetical example, below, is a section of the schedule as it appears in the guidelines:

Monthly Net Income


Two Children

Three Children

Four Children

Five Children

Six Children




































There are many child support calculators available on the Internet, most of which do a good job of calculating the basic figure.  But as you will see below, under certain circumstances, these figures can be adjusted.  Regardless, it’s a good idea to understand the “math” in order to arrive at the child support number for your particular situation.

Our example is that of hypothetical divorcing parents, Tom and Mary.  For the purposes of calculating the child support need, all the relevant information is as follows:

Annual Gross Income

Annual Net Income

Monthly Net Income

Combined Monthly Income












From the schedule, based on the combined monthly income and number of children, the monthly child support need is $2,175.  Now, we need to calculate the portion that belongs to each parent.

To calculate each parent’s monthly child support responsibility, first we determine Tom’s percentage of the combined monthly net income:

This means that Tom is responsible for 66.67% of the established monthly child support need of $2,175.  This amount comes to $1,450.07 (i.e., $2,175 x 66.67%).  In turn, Mary’s responsibility is the difference between the established monthly child support need and Tom’s responsibility, or $724.93 (i.e., $2,175 – $1,450.07).

In this example, it’s assumed that Tom and Mary equally share custody of the children.  If, however, one parent has the children, say 20% more of the time then the other parent, then these figures would be adjusted accordingly.

It’s important to note that guidelines allow for the child support need to be modified (+/- 5%) from the guideline amounts, after considering all relevant factors, including:

  • The needs of the children, their age, station in life and standard of living.
  • The financial status and ability of each parent.

Furthermore, the child support need determined by the schedule can be adjusted for the following reasons, among others:

  • Extraordinary expenses of a child, such as for medical, psychological or educational reasons.
  • Expenses due to a disability.
  • The age of the children, since older children have greater needs.
  • Total assets of the parents and the children.
  • Childcare costs.
  • Cost of healthcare for the children.

Child support is always modifiable based on substantial changes in the circumstances upon which the original child support need was calculated.

Alimony Calculation — Guidelines and Example

Alimony or spousal support is a payment to a spouse in need of financial support by the spouse who has the economic ability to pay the support.

“Often the most pressing questions my clients have regarding alimony is how it’s calculated and if it can be changed or modified after the divorce,” says family law attorney Carolann Mazza.

The answer to these questions depends on the type of alimony award.  As per Florida Statute 61.08, there are four types of alimony, with each having its own unique characteristics:

  1. Bridge-the-gap.  Is awarded to assist a party in the transition out of married life. The purpose of this type of alimony is to assist an individual with legitimate, identifiable, short-term needs and the award may not exceed two years.  Bridge-the-gap terminates upon the death of either party or the remarriage of the person receiving the alimony.  The amount or duration of this type of award cannot be modified.
  2. Rehabilitative.  Is awarded based on the prospects for the receiving spouse to be rehabilitated and thus becoming self-supporting.  The length of the award depends on the time needed for rehabilitation..Unless otherwise stated or agreed to, rehabilitative alimony can be modified or terminated.  This type of alimony can cease upon the death of either spouse or the expiration of the rehabilitation period, but not necessarily on the remarriage of the spouse receiving the support.
  3. Permanent.  Is more common in longer-term marriages (those lasting 17 years or greater) where one spouse has diminished prospects for rehabilitation or becoming self-supporting.   It can even be awarded in cases where the spouse receiving alimony can work, but can’t earn enough to maintain the same standard of living.  Unless otherwise specifically stated or agreed to, permanent alimony can be modified and ends upon the death of either party, the remarriage of the spouse receiving the alimony, or if the receiving spouse is in a supportive relationship.   Any modification is based on either party experiencing a permanent, involuntary change in circumstances that would warrant a change of the alimony awarded.
  4. Durational.  May be awarded when permanent alimony is not appropriate.  This type of award provides economic assistance for a set period of time, if there is no need for spousal support on a permanent basis.  As with permanent alimony, the amount awarded under this type of alimony may be terminated or modified.  However, the length of the award may not be modified except under exceptional circumstances and may not exceed the length of the marriage.

Once the need of one spouse for alimony and the ability of the other spouse to pay is determined by the court, the following are also considered when determining an alimony award:

  • The standard of living enjoyed while married.
  • The length of the marriage.
  • Age, earning ability, health, education level and the employability of each party.
  • Value of the respective financial estates, including non-marital and marital assets/liabilities distributed to each party
  • Personal sacrifices and contributions made during the marriage.
  • The responsibilities that each spouse will have in relation to minor children they have in common.

With so many factors considered and no two divorces being alike, alimony awards can vary widely.  This means that while there are multitudes of alimony calculators available on the Internet, none of them will provide you with an “actual” figure that you can use or count on as a reasonable estimate of what the court will award.

“Because alimony is uncertain,” Mazza says, “parties that reach their own agreement regarding alimony can have more certainty and flexibility than when a judge makes the decision for them.”