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Posted on August 9, 2019 1:11 PM by Gina
Categories: General
 
 
Did you know that couples over the age of 50 have the highest rate of divorce? A recent article in Forbes quoted a Pew Research study, which found that while there has been a 21% decrease in the divorce rate of couples between the ages of 25 through 39 over the last 25 years, the divorce rate among those in the 50+ age group has increased 109% during the same time period. 
 
A further negative impact on this increase in “gray divorce” is the additional complexity of dividing assets following a long term marriage. Two areas, in particular, accumulated wealth and retirement income present much greater challenges to divorcing couples over the age of 50 when compared to younger couples.
 
Accumulated Wealth
The equitable distribution of property can be significantly more complex when couples divorce later in life, simply because there is typically more to divide.  Laws determining the division community property (owned by both parties) vs. personal property (owned by only one of the spouses) varies by state.
 
Therefore, pinpointing the details of all property accumulated during the marriage should be made as early as possible when divorce is being considered. Examples of what to catalog include the description, title, and value of all:
 
  • Community property
  • Personal property
  • Community debt
  • Personal debt
 
Retirement Income
After alimony, retirement income this is the biggest source of contention during a divorce settlement, according to an American Academy of Matrimonial Lawyers survey. The settlement of joint retirement income is a primary concern in gray divorce, for the simple reason that there is less time to recoup any losses. Considerations to be made during negotiations include:
 
  • What percentage of your spouse’s 401k or pension are you entitled to?
  • At what age can you begin collecting from your spouse’s 401K or pension?
  • What will you need to do post-divorce to restore /increase your retirement savings?
 
Where to Begin
While there are many common areas of concern in any divorce, it’s important to remember that the financial details each couple brings to the table are unique, so retaining the services of a CDFA®  is an ideal first step when considering divorce after the age of 50. The CDFA® can assist you in assessing all financial options based on your unique situation before you commit to a divorce settlement.
 
Download my free checklist Charting Assets to help you get started. Having this financial information organized will allow empower you in your decision making throughout the marital transition process. 

 
Posted on June 21, 2019 8:14 AM by Gina
Categories: General
married couple in marital transition
 
The decision to leave one’s marriage is an extremely difficult one, fraught with emotion, and a seemingly endless series of complex, far-reaching decisions that could impact your children, your income and assets for years to come. It’s no wonder that those experiencing marital transition often become overwhelmed, leading them to make decisions against their best interest.
 
What is Marital Transition?
The process of divorce is clearly defined as a legal dissolution or termination of a marriage. However, marital transition is a bit broader and can include any of the following stages, pre, and post-divorce:
 
  • Considering divorce, but no decision made yet
  • Filed for divorce or have been served with notice of divorce filing
  • Currently in the divorce process
  • Divorce finalized, but new financial concerns arise
 
At any of these stages, engaging the services of a Certified Divorce Financial Advisor (CDFA®) is a worthwhile investment in your peace of mind that sound financial decisions are being made.
What is a CDFA®?
 
What is a CDFA®?
A CDFA® acts as a liaison between the client, and divorce mediators and matrimonial attorneys, specializing in guiding clients in navigating all financial issues and decisions surrounding divorce from assessing their options for fair and equitable settlements.
 
Certification is granted by the Institute for Divorce Financial Analysts to applicants who complete a four module independent study program. Eligible applicants must possess a Bachelor’s degree and at least three years experience in the financial or legal fields, including:
 
  • Financial professionals
  • Accountants
  • Matrimonial attorneys Annual reinstatement of CDFA® certification is required, in addition to fifteen hours of continuing education every two years.
 
Why Should I Hire A Certified Divorce Financial Advisor?
While your mediator or matrimonial attorney will focus on the legal aspects of the divorce, throughout the marital transition, the CDFA® professional assists the client with:
 
  • Identifying the short- and long-term effects of dividing property
  • Addressing any tax concerns
  • Analyzing options for dividing pension and retirement plans
  • Recommendations regarding the marital home
  • Evaluating the client’s insurance needs
  • Establishing projections on inflation and rates of return
 
With the ability to collect financial and expense data, develop budgets, identify future goals, and assess the financial impact of a proposed divorce settlement, a CDFA® is an essential member of your marital transition team.
 
In fact, given their ability to provide practical and actionable information from the get-go, CDFA®s are quickly becoming the “gatekeepers of divorce”, a role historically held by therapists as the ideal first professional to consult with prior to beginning divorce proceedings.
 
If You’re Considering Divorce
Engage the services of a CDFA to ensure that your interests are addressed as early as possible. Prior to your first meeting, it’s a good idea to make note of the priorities for both you and your spouse in terms of:
 
  • Division of property
  • Finances (ex. spousal support, division of debts, division of retirement assets, etc.)
  • Children (ex. Child support, custody, and visitation)
 
Download my PDF worksheet: Divorce Priorities Checklist to help you get started. Laying out the high-level priorities will help structure the planning that you will do with both your CDFA and attorney.

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Gina Phillips is NOT an attorney or CPA and does not provide legal or tax advice. Changes in tax laws may occur at any time and could have substantial impact upon each person’s situation. You should discuss tax or legal matters with the appropriate professional.