Divorce Planning - Frequently Asked Questions
Does AJW have experience working in the collaborative divorce process?
AJW has worked on over 1,500 collaborative divorce cases. AJW has a depth of experience in working with families to reframe their finances as they work through their collaborative divorce.
Does AJW have experience working in mediation cases?
AJW has worked on many mediation cases as a neutral financial professional along with the mediator, to help families restructure their finances. They have also teamed up with the client and their attorney as they move through the mediation process to help evaluate options that are generated during mediation.
What is the difference between a neutral financial professional and mediator?
A neutral financial professional helps families and individuals work through the financial elements of divorce. Financial neutrals are often financial advisors and CPA’s who have specialized financial knowledge. Often a neutral financial professional may have some mediation training but it is not a requirement. Mediators are required to complete a five-day training in order to receive mediator status. Mediators are trained in helping couples overcome impasse in the divorce process.
Does AJW provide expert testimony in court?
AJW prefers to work in collaborative and mediation cases where both parties are focused on arriving at a mutually acceptable settlement.
What does taking a facilitative versus directive approach mean?
In a directive approach, your financial information is laid out and opinions provided in regards to the manner in which to structure the financial settlement. In a facilitative approach, AJW guides the husband and wife through a process where all the data is collected, identifies the issues, generates options, and then numbers are run to help the parties evaluate the options. In a facilitative approach, the parties make a final decisions on how to structure their finances going forward post divorce.
How can AJW work with me and my attorney during my divorce?
We will work with you and your attorney to develop a budget and analyze tax issues so that you better understand your settlement options. We will also work with you and your attorney to put together different settlement options to consider and run the numbers to help you understand the impact of a settlement offer and whether or not it will meet your future needs.
What are the main areas I need to think about as I work through my divorce?
There are three main financial areas to consider as you work through your divorce. First is the property division. As you work through the property division, you will want to consider the growth potential, tax consequence and liquidity of each asset. Second is budgeting. It is important to understand what your monthly expenses will be for you and your children post divorce. Third are taxes. You will need to understand how your taxes will change and how they will impact your settlement (e.g. what should your filing status be? What is the best way to structure your child exemptions? How will family support effect your tax situation?).
AJW is our neutral financial professional, can I ever meet with AJW alone, without my spouse present?
Typically, when working with a neutral financial professional, it is best protocol for the financial professional not to meet one-on-one with only one spouse. This is to help ensure transparency of the process and that both parties have access to the same information. However, in certain situations, it may be helpful to have a separate meeting with a neutral financial professional to help move the divorce forward. This can be done as long as the other spouse and their attorney are in agreement.
Are there any special guidelines when working with a neutral financial professional?
When working with a neutral financial professional, transparency is key. When you communicate with a neutral financial professional, make sure that your spouse is aware of the communication. For example, if you e-mail information to AJW, or ask questions related to your financial situation, it is important to copy your spouse so that the financial professional can reply "all" to ensure that you are both in the loop with the response.
My spouse understands our finances better than I do. How can AJW help me?
One of the most important things that AJW does during the divorce process is to make sure both spouses are educated on their investment options. Our divorce professionals are able to explain things in a straight forward manner, which helps less knowledgeable spouses understand the impact to their investments and the tax consequences resulting from different settlement options.
I have received a settlement offer from my spouse. Can AJW help me understand the impact of accepting it?
Our divorce professionals have the experience, skill set and technology needed to model settlement options and provide education regarding the impact of the option(s).
How do I know if I can afford to keep the house?
The best way to approach whether or not you can afford to keep the house is to have a good understanding of your monthly expenses going forward. It’s important to make sure that you can meet all of your needs, including your housing needs. AJW can help you put together a budget, explore various housing options and run tax projections to explore the tax savings obtained by owning a home.
Why do historical expenses matter?
Often it is helpful to understand historical spending to help project expenses post-divorce. Historical spending may not always drive expenses going forward, but it is useful information to have. Putting together accurate monthly expenses is the foundation of a solid financial plan post-divorce. It’s important to make sure that you put together a workable solution, so having historical numbers is a good starting point to help make sure projected expenses are realistic.
What is the typical cost when AJW works as a financial neutral on a collaborative divorce case?
Every situation is unique and there are many variables that drive how the divorce process may play out. To receive a general quote, or for more information, please call AJW at 952-405-2000.
What can I do to help decrease my divorce costs?
Often when you work with a divorce financial professional, you save attorney costs because we complete the financial work that attorneys would otherwise do. You have one professional doing the work that two attorneys might do. You can also save divorce costs by compiling your information in an organized format and providing it to AJW ahead of your meeting. Providing the data well in advance of a working session allows AJW to block off case prep time to more efficiently work through your divorce case.
How much will it cost to get a divorce?
There are many different divorce processes, all with different associated costs. One typical process is litigation. Divorce cases that go to court will be the most expensive and can possibly reach six figures for each spouse. Even litigious cases that never reach the court room can be as expensive.
Another process is collaborative divorce and mediation cases. These processes are characterized by the fact that most of the decision making is put into the hands of the parties involved. These processes will be less expensive if the couple is good at communication and able to make decisions together. Complications usually arise when dealing with difficult issues, but a collaborative case will generally be expected to be significantly less expensive than a litigated case. Costs are directly related to the quality of communication and follow through of the couple.
Do I need to have an attorney?
You do not have to have legal representation when going through a divorce. Though we believe that everyone should strongly consider consulting with an attorney to ensure you understand your legal rights and obligations.
What is alimony/spousal maintenance?
Spousal maintenance, also referred to as spousal support, is a series of payments from one spouse to the other, for a specified time-frame after a divorce. The purpose of maintenance is to help balance the earning abilities of each spouse so that they maintain a similar standard of living post-divorce.
Are there alternatives to paying spousal support?
An upfront lump-sum cash payment or awarding more marital assets could offset spousal support. This eliminates the risk of relying on the ex-spouse to pay in a timely manner. There are advantages, disadvantages based on your specific situation.
How do I know if I am receiving a fair settlement?
AJW can assist you with understanding the financial and tax impact of diverse settlement proposals covering asset distribution, debt assignment and spousal/child support, to help you reach an acceptable agreement.
How do I know which assets are the best ones to keep?
All assets are different, some continue to grow and gain value while other assets require money for upkeep. Businesses and retirement accounts will continue to grow, and homes and automobiles necessitate upkeep. Costs must be considered when contemplating a settlement. Certified Divorce Financial Analysts educate you in these situations, and help you navigate the complications of asset distribution.
What happens with our house?
Often the custodial parent will want to keep the house. We help analyze the associated costs, factoring in mortgage payments, taxes, inflation and maintenance. Once determined, we assist you in making the best possible decision for your specific situation.
What is a QDRO?
A Qualified Domestic Relations Order (QDRO) is a required legal document, in addition to your divorce decree, that divides up qualified pensions and/or retirement accounts.
I was a stay at home parent, will I receive Social Security?
If you have been married 10 or more years, you are entitled to either half of your working spouse’s Social Security or your own benefit, whichever is greater. Your spouse still receives 100% of their benefit.
Can I work with AJW as a financial client after my divorce?
When you work with AJW in a non-neutral role during your divorce process - advocating on your behalf - you're welcome to shift to work with the professional for ongoing guidance and financial planning through AJW Financial. However if we served as a financial neutral for both spouses during your divorce process, we do not continue working with either party individually post-divorce, unless the other spouse provides written consent. This policy helps maintain neutrality and fairness throughout and after the divorce process.