Top Tips for Getting Divorced
Divorce is a frightening prospect. It is a well-known fact that divorce is one of the most stressful events one can suffer in a lifetime. So here are my best tips to help you deal with the stress of the change that is divorce.
Accept it. You can’t do much about what has happened. You can, however, significantly impact how you react to it. This is a fresh start, a new beginning. See it that way.
Listen to what you say. Want to attract more good stuff? Then talk about good stuff and what you are doing to move in the direction of the good stuff.
That being said, you must also understand when to be quiet and listen. If you are able to hear your spouse’s point-of-view, you will be more willing to consider possible settlements.
Focus on your future. Talk with others about what you want. Then listen and be willing to accept what they offer.
Choose your divorce process. There are multiple divorce processes, and you are not required to litigate. Be sure to consult a lawyer who can explain your different courtless options.
Focus on interests, not on positions. Identify your interests; there may be several ways to achieve your goals. This will give you more bargaining room and increase the likelihood that both of you can accomplish your most important goals with fewer compromises.
Be realistic! Try to see the big picture, and take time to view issues from your spouse’s perspective.
Remember that your attorney is on your side. S/he has your best interests at heart. Just because s/he is telling you something that you do not want to hear, doesn’t mean that s/he does not understand what you want.
Understand that you have signed a contract with your attorney. If you don’t understand the terms of it, ask your attorney questions. If you are not comfortable with the amount of time billed on your case, discuss this with your attorney sooner rather than later.
Do your homework. Any divorce takes a lot of hard work. The more work you do, the more that you will be committed to resolving the matter, and the less you will have to pay your attorneys and other professionals to do the work for you or to chase you down to do the work they requested of you.
Be transparent. Disclose everything material to your divorce, and by doing so, you will develop the trust necessary to settle your differences and move forward with your ex as amicably as possible.
Observe the Golden Rule. Treat your spouse as you would like to be treated.
Remember; if you have children, your divorce does not end your relationship with your spouse. While divorces are highly emotional, try to remember that there will be life after your divorce, and you want to avoid doing things during this process that will be destructive to your relationships with your spouse and with his/her family.
My Divorce
When I was 30, I finally got married to another lawyer who wooed me incessantly for seven months. When I say “he wooed me,” by the way, I mean that I would have called it “stalking,” had it happened today, 27 years later. I used to drive across the toll road in the mornings coming in to the office from the suburbs, and he would be waiting in his Corvette on the other side of the tollbooths. He would then follow me to the office, park near me, and invite me to a late breakfast.
[expand title=”CONTINUE READING…”]Soon after we began dating, I moved in with him, and he proposed. Ultimately, we married on Valentine’s Day. My husband changed his colors dramatically after that. He gained 80 pounds in six months. He soon asked me, and I agreed, to start paying the mortgage because his firm was not bringing in enough to pay the overhead plus his salary. He assured me “I’m putting the deed in both of our names.”
We’d been married for about a year when I started to notice money missing from my wallet. I finally confronted Charles and demanded “what is going on?” He shrugged, and responded “I needed some money. It’s no big deal.” I was upset, but nothing I said seemed to make a difference.
One morning, my secretary timidly approached me because Charles had asked her to notarize his client’s signature without seeing him sign the documents and without verifying his driver’s license. I immediately went to Charles, explaining, “Nina can’t notarize someone’s signature without verifying it. She needs to see your client, to inspect his driver’s license, and to confirm that he signed the document you gave her.”
“Not a problem.” He was nonchalant. “She should have said so.”
Well, now, that was odd; I knew she had.
When Charles announced that he had sold our home, I was furious and told him that I would sign off on the sale but that I wanted a separation to think things over.
When I asked for the spare keys to my VW bug, he responded “Oh. I lost them.” I believed him. Soon, I noticed once again that money was repeatedly missing from my wallet. The third time it happened, it struck me that Charles had not lost my car keys, he had simply kept them, planning ahead.
I made an appointment with the guy in my new workplace who practiced family law, explaining that I needed to get a divorce.
“Not a problem. Fill out an intake form, and I’ll get the petition filed right away. Then we can discuss logistics.”
My heart leapt into my throat. “What?! You have to file a lawsuit to get divorced? I didn’t have to go to court to get married!”
I had been practicing law for nine years. But I didn’t know that you have to go to court to obtain a final judgment of divorce. I was shocked!
Thankfully, Charles agreed to my settlement offer, and I was able to finalize my divorce quickly.
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Getting Educated – The Jack and Jill Story
While dissolving a marriage is wrought with emotion, parties should strive to use their brains, instead of their hearts, to negotiate the distribution of marital assets and debts. By doing so, they will have a better opportunity to reach an agreement that most effectively manages their debt in a way that allows both parties to move on to their futures in better financial positions. This is especially true when, like many families, they are tasked with distributing much more debt than assets. Consider the story of Jack and Jill that follows.
[expand title=”CONTINUE READING…”]Jack and Jill married twelve years ago when Jill became pregnant with their first child. They now have three children under the age of ten. Their career and family obligations have finally taken their toll, and Jill has petitioned for divorce. She would like to receive half of the equity in the marital home, which is their only real asset with value. She would also like primary custody of the children and child support. All the parties’ debts are jointly held, and Jack and Jill have agreed to split them equally, except for Jack’s student loans of $50,000 for which he will take full responsibility. There is a car loan in both of their names, several credit cards, and another line of credit. Jack and Jill are currently, and have been previously, employed full time, and there is no claim for spousal support.
Many parties faced with this all too common situation and inadequate professional guidance end up selling the marital home and paying off as much debt as possible. But sadly, due to the six percent realtor commissions that consume most of the equity in the home, much of the debt would remain unpaid, leaving Jack and Jill each with no home, remaining debt, and the inability to purchase new homes because of the remaining debt and lack of assets. Or, they end up filing for bankruptcy due to the overwhelming debts that would not have been paid off. Neither alternative puts either party in a positive financial position.
But luckily for (or wisely of) Jack and Jill, they sought the assistance of creative family law attorneys and financial professionals. Instead of seeing each other as enemies whom they had to battle against and their divorce as a win/lose event, they patiently worked together to devise an agreement that put both party in the best financial position possible.
One of Jill’s major interests was to receive half of the equity in the home so that she could purchase her own home, and Jack desired to keep the marital home so that the children could remain in the same school district. But, aside from the marital home, there was no asset from which Jack could pay Jill her half of the equity in the home. And due to the substantial debt in both parties’ names, Jack could not have qualified for a loan. It seems like an impossible scenario, right? But with the proper guidance, as well as a heaping spoonful of trust between the parties, Jill reluctantly agreed to move Jack’s debts out of his name and into her sole name prior to the entry of the final judgment of divorce so that Jack could qualify for the loan. (Note that this could have been very messy post-final judgment but was easily completed prior to the finalization of the divorce). Jill also agreed to trade in her car and transfer the balances on several of the credit cards to new cards in her name only.
That doesn’t mean that Jack did not take responsibility for any of the debt. The parties’ assets and liabilities were equally distributed so that each party left the marriage with equal marital net worths. The debts that Jack accepted were included in the loan, paid off, and closed. An important point to note here is that post-final judgment, Jack wouldn’t have qualified for the home loan because of the child support payment. This would have kept the parties from reorganizing the jointly-held debts and Jill from receiving her half of the equity in the marital home that she needed to purchase her own home. Getting the loan completed and the debts reorganized prior to final judgment allowed them to complete the transition exactly as they had agreed and in a way that met their primary interests.
Their main interests were keeping the children together in the same school, each party having a suitable home, and separating and eliminating the debts. Because of those interests, it was imperative that the marital home be kept. Should they have finalized the divorce prior to completing the refinance, the home would have needed to have been sold, forcing the children into different school systems and Jack and Jill into precarious financial situations. Patience, trust, and the help of competent, creative professionals helped Jack and Jill to reach a fair resolution with which they could both live.
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Getting Educated – The Frankie and Molly Story
Frankie and Molly were college sweethearts. When they married right after graduation, they were in love and thrilled to start their lives together. Molly became a schoolteacher, and Frankie began a fairly lucrative business selling used sports equipment. They quickly had two boys and were ready to take the world by storm. Molly worked but was also the primary caregiver of the boys, and Frankie was the breadwinner for the family.
[expand title=”CONTINUE READING…”]Unfortunately though, the stress of having two young children, two full-time careers, and not much quality time together like they had in their carefree college days finally wore Molly too thin. She petitioned for divorce.
Frankie feels blindsided and hurt. He thought that they were happily married. Sure, they had their problems, but until the day he was served with divorce papers at work, he had no idea how unhappy Molly was. When negotiating, Frankie often becomes indecisive about on what he will compromise. Sometimes he is very generous, and other times, he becomes spiteful and unyielding.
Molly is being advised by a friend, who went through a nasty trial divorce, to make Frankie pay as much as possible. Luckily Molly doesn’t want to drag her kids through a messy ordeal.
The most contentious subject is who will keep the marital home, which has about $80,000 in equity in it. Prior to learning of the divorce, Frankie had been planning to remodel the kitchen and actually committed to a contractor on a $20,000 contract. He uses this as leverage to assert his dominance in keeping the home. He states Molly would have to pay half of the cost if she wants to keep the house, and she does not have the funds to do so.
As a school teacher, Molly’s income is less than a third of Frankie’s. Because they have no other debt, she easily qualifies for the refinance on the home. Frankie has about $100,000 in assets in his retirement account, and Molly has no savings or retirement. Frankie is self-employed and tends to owe money for taxes each year.
Because Molly has filed just after the first of the year, the income tax filing becomes part of the negotiations. Frankie is about to file their taxes and has been complaining that they will owe money. Since Molly is the one who wants a divorce, he feels that she should have to pay half of the tax obligation. Therefore, I instruct Molly to contact her CPA to determine if she will have any tax liability if she were to file taxes on her own.
After speaking with her accountant, Molly determines that if she files her taxes by herself, even if she doesn’t claim either child or the mortgage interest credit, she would actually receive a refund. Through the discussion with the CPA, we further determine that if the parties file together, Frankie would save about $10,000 in taxes he would be required to pay if Molly files on her own.
Through discussions with his own attorney, Frankie unhappily learns that he will likely have to split his retirement fund with Molly, pay alimony and child support, and pay her half the equity in the home if he wants to keep it. He also finds out that he would owe about three times as much in taxes if she chooses to file separately.
So when the parties and attorneys all meet together to discuss these financial findings, Frankie is happy to find out that, with the help of her attorney and accountant, Molly has come up with a creative solution to the problem that meets each parties’ most important interests. She is willing to forgo a request for alimony and let Frankie keep his retirement, if she can have the home. Since she is asking to keep the home and all the equity, she will do a cash-out-refinance on the home after the renovation to pay for the cost of the renovation, which Frankie put on a credit card in just his name. Molly also agrees to file taxes together with Frankie that year to save him $10,000.
At the final hearing, Frankie coyly admits to Molly that he never really wanted to keep the marital home, he was just hurt. In fact, it was actually important to him that his boys stay in that house, and he was glad things worked out the way they did.
Parties to a divorce often benefit from seeking guidance not only from their attorneys, but also from other professionals like accountants, financial planners, and mortgage specialists. Outside professionals can help the parties formulate creative settlements that most effectively meet their highest interests.
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