DIVORCE AND ALIMONY

Divorce and alimony are two topics that are highly emotional. Attorneys tell me the two most important factors considered when determining alimony are what the wife needs and the husband is able to pay. The wife must prove her need by explaining her expenses and ability to earn income. The emotional stress of divorce is quite intense. It is likely both spouses will have a hard time thinking clearly enough to sort out their expenses. If this is the case, I recommend they find an Accredited Financial Counselor to assist them at www.AFPCE.org. Do not rely on your divorce attorney … Continue reading

DIVORCE AND TAXES

Divorce and taxes should go hand-in-hand like peanut butter and jelly. Well, not exactly like that but, tax issues should be addressed during divorce negotiations. If they are not, you could end up with a surprise tax bill in April 2016. For example, if you think your divorce will be final in 2015, you should consider having your withholding changed from married filing jointly to single or head of household now. If you get divorced in 2015, the IRS will assume you have been divorced the whole year regardless in you are divorced in February, July or December. This means … Continue reading

DIVORCE FIRST STEPS?

Divorce first steps? If you are divorcing, your emotions may have best of you. Feeling scared and wanting to be protected are common “knee jerk reactions”. As a result of the emotions, the first thing most divorcing spouses do is hire a divorce attorney. However, if a client does not address their own emotional needs, hiring a divorce attorney won’t help their feeling of being out of control on an emotional roller coaster. The first step in divorce should be to hire a therapist rather than an attorney. A therapist is the professional best able to help you deal with … Continue reading

FAIR DIVORCE SETTLEMENTS IN NASHVILLE

Do you have a fair divorce settlement? You may think so but, I see 3 common mistakes in settlements.  The first mistake is you don’t know what to ask for because you don’t really know what you need.  The mistake here is not understanding your monthly living expenses. A thorough list of monthly expenses should have about 140 items.  If you don’t have this many items listed, you are forgetting things and will underestimate your expenses.  This translates into, you accepting an offer that will not meet your needs. The second mistake is forgetting about inflation.  Financial planners are currently … Continue reading

What To Do When Your Spouse Won’t Provide Financial Info

If your spouse is uncooperative, you have two options: Pay your attorney to go to court or, educate your spouse what lies ahead if they are uncooperative. A spouse who is refusing to provide financial information does not understand they can’t withhold information. Perhaps they have always been secretive about the money… Perhaps their best friend told them not to turn over the information. Your spouse is just scared and really has no idea of how to navigate the divorce process. I’m not defending bad behavior. Just trying to help you understand why your spouse is being difficult. If they … Continue reading

Creative Problem Solving During Divorice

Does one size fit all? While this concept is most commonly applied to clothing (these items rarely fit properly), it also used in divorce settlements. Regardless if the settlement is in Nashville, Brentwood, TN or your city and state. Your family is unique and so are your needs. Yes, attorneys tell me a 50 / 50 division of assets is common in Tennessee. However, how the 50 % is achieved does not mean that every asset is divided evenly. Perhaps one spouse needs more cash. Perhaps one spouse wants to keep the frequent flyer miles, the house or a specific … Continue reading

Adjusting to Life Financially After Divorce

Going through a divorce can be an emotionally difficult time. Ironing out a divorce settlement, attending various hearings, and dealing with attorneys can weigh heavy on all individuals involved. In addition to the emotional impact, individuals and families are left trying to assess how their financial position will be impacted. It is vitally important as you walk through the divorce process that you make sure your finances are on track. It is equally important to begin cultivating a relationship with a financial advisor who can assist in identifying any gaps in your financial position as a result of your circumstances … Continue reading

What is QDRO?

A QDRO (Qualified Domestic Relations Order) is a legal document necessary when dividing a qualified retirement plan such as a 401(K) or 403(b). It is not required when dividing an IRA. A QDRO is typically prepared by the divorce attorney and costs about $1,200. If you are dividing retirement funds, you may want to consider minimizing legal fees by dividing an IRA rather than the 401(K). Here’s an example: If you have a 401(K) with $50,000 and and IRA with $100,000 your total retirement funds are $150,000. If the assets will be divided 50/50 then each spouse should receive $75,000. … Continue reading

Understanding Stock Options

If in the midst of divorce and your marital estate includes stock options, it is important to understand the details. Stock options cannot typically be transferred to the other spouse. For example, if your spouse receives the stock options from their employer, they are assigned to that person and cannot be transferred to you. Your spouse will have to exercise the options, pay the taxes and the net proceeds can be transferred to you. This transfer will not have tax consequences if the transfer occurs within 12 months from the date of divorce. Regardless if you live in Nashville, Brentwood, … Continue reading

Don’t Forget the Financial Details

A divorce client mentioned she was considering allowing her husband to have three years to pay her the money he owed her from her share of their business. Giving him three years would reduce the considerable financial pressure on her soon to be ex-husband and his business. I told her I thought this was quite beneficial for her husband and reminded him she was entitled to the potential interest she could have earned on those funds had she received them at the time of divorce. If she did not ask for the interest, she would be walking away from $27,000. … Continue reading