How to save money in California divorce

Divorce can be very expensive.  Not only are you separating households, now working with the same funds but supporting two homes (and two rents/mortgages, two sets of utilities, expenses of duplicate furniture, etc…), but you may be taking time off work (unpaid, of course) for court hearings, spending money on filing fees, and – of course – hiring a lawyer.  And lawyers?  Can be very expensive.

I do what I can to keep the costs down for my divorcing clients, from offering flexible options for payment (no, not monthly payments but I generally try to “break down” the case into more financially-manageable pieces for the client), family law coaching, and divorce mediation, but the cost is not entirely under my control.  What my clients do – or don’t do – essentially drives the path and cost of the divorce.  So, regardless of whether you have an attorney or not, here are some ways to keep the costs of your divorce down:

1. Manage your emotions.  Divorce is incredibly difficult even in the best of circumstances.  It is likely that you have some strong emotions around it.  But the court and legal process generally will not be concerned about these emotions, and the more  you bring them into your divorce, the more you will likely pay.  Whether it’s spending excessive time with your attorney discussing the emotional issues or pursuing a losing issue because of an emotional attachment, emotions can bankrupt you when they take center stage in your divorce.
2. Get professional help. As a part of managing your emotions, get the support you need for them by finding qualified mental health professionals to help you through it.  Your lawyer, your family, and your friends will be a great support during this time, but do not mistake any of them as qualified advice helping you through the roller coaster of emotions in divorce.  Find a therapist if you need one.
3. Get – and get rid of – qualified professional help when appropriate.  Hire professionals who are going to work with you, for you, and who are on the same page as you.  If you feel like your lawyer doesn’t care, or is gouging you, or won’t pay attention to you or return your calls, then get rid of him/her.  Your divorce is yours, and you should have legal counsel that you feel comfortable with, who understands what is important to you, and who is reasonable and professional about fees.  Same with your therapist.
4. Play fair.  The court and legal process in California has no patience for bids for revenge.  Mud-slinging and nasty declarations for the purpose of hurting the other party can not only rebound and hurt you, but can cost you unbelievable amounts of money.  They also drag on the process, increase the hostility between you and your spouse, and ultimately hurt your children.

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Avoid these shortcuts in estate planning and save your assets, protect your family, and leave a legacy

We’re all looking to save money and get our to do list done as quickly and easily as possible.  But when it comes to estate planning, quick and cheap shortcuts can end up not only costing you in the long run, but can hurt both your family and your legacy.

For example, if you decide to forego an estate plan for your real property, and instead opt for joint tenancy, then you are at best just delaying the probate process, and at worst exposing your home to complete loss in your lifetime. With joint tenancy, there may not be any need for probate or transfer proceedings at the death of the first spouse (just some simple) paperwork, at the death of the survivor, the property goes into probate, which can take years and cost up to 10% of the gross estate value, which can be in the tens of thousands of dollars even for estates with just a house – even one with substantial debt.  Putting a child on title to the property does not solve this problem, and can lead to your child’s creditors seizing the house, the inability to undo the transfer at a later date when needed, a loss of control over the disposition of the house, more complications in transfer at the survivor’s death, and more.

Another shortcut is either being incomplete or too vague in your estate plan documentation.  If you have a living trust, it must be funded completely.  It does not serve you or anyone else to leave “just that one account” outside the trust since it ‘has so little in it.’  Why leave a small account – or a large one – outside the trust and make it more difficult for your family to transfer it? It’s possible then that the bank will just get your money since it will be too much trouble to transfer the account outside the trust.  In addition, if you have provisions for the distribution of your estate, make sure you have alternate provisions in case your beneficiaries do not outlive you.  For example, if you are leaving everything to your children, make sure you have a provision for who gets your estate if the airplane goes down and you all pass at the same time.

There are a lot of aspects of estate planning that can easily be completed improperly, costing you, your family, and the estate you worked your life to build. Estate planning is not the place to look for a quick or cheap solution, but rather to take the time to ensure that all you’ve worked for is left just the way you want it.

Financial Advisors & CDFA in California divorce

I met with a financial advisor today, and he has the designation of being a CDFA, or “Certified Divorce Financial Analyst.” He is an expert with working with people who are divorced, getting a divorce, or thinking about it. I am a really big proponent of getting the help you need in divorce. It’s not easy and there are just so many mistakes you can make – and avoid – by getting good help.

The more I think about it, the more I think that it’s critical for someone who is divorcing to have the support of a financial advisor. Take the situation when you’re dividing accounts. Say you have an account with Schwab and an account with another broker. They each have roughly the same amount of money in them, so you and your soon-to-be-ex decide to each take one account. But does anyone look at the projections for the accounts? What if one account is doing poorly and one is doing really well? Attorneys aren’t trained to make those kinds of evaluations. This is a reason to see a financial advisor – especially a CDFA – if you’re getting a divorce, or even thinking about it.

Another reason: Generally, I saw in my practice that in most couples, one spouse was ‘in charge’ of the money in the relationship. They handled the bills and expenses, did the taxes, and dealt with the CPA or financial advisor. Often, the other spouse had not a clue what the couple had, leaving the decisions up to the other. While this is (I think) a reasonable marital division of labor, it causes big problems for the spouse in the dark when the issue of divorce comes up. Suddenly the spouse who doesn’t know anything has to take a crash course in finances, household budgets, and the like. He or she also probably wants nothing to do with the couple’s advisors, as they’re likely to go with the person they’ve been dealing with all along. This is where a financial advisor can mean the difference between struggling and flourishing.

Finally, and you may know this about me, I am a planner. I do estate planning and feel it’s absolutely essential that EVERYONE has an estate plan – SOME kind of plan – and if they have children or a house, it becomes urgent. But that’s another story and another blog. The same is true for financial planning. Right now, you’re at Point A in your life. At some point, you want to get to Point B. How are you going to do that, financially? What if you don’t even know what your Point B looks like? You find these answers by utilizing the help that’s around you, and in this case, it’s a financial advisor.

I am spending some time in the next few weeks talking to several CDFAs, and I’ll pass along the pearls of wisdom I learn. I meet with them so that I can feel comfortable referring my clients to them.

How to save money in California divorce

Divorce can be very expensive.  Not only are you separating households, now working with the same funds but supporting two homes (and two rents/mortgages, two sets of utilities, expenses of duplicate furniture, etc…), but you may be taking time off work for court hearings, spending money on filing fees, and – of course – hiring a lawyer.  And lawyers?  Can be very expensive.

I do what I can to keep the costs down for my divorcing clients, from offering flexible options for payment (no, not monthly payments but I generally try to “break down” the case into more financially-manageable pieces for the client), family law coaching, and divorce mediation, but the cost is not entirely under my control.  What my clients do – or don’t do – essentially drives the path and cost of the divorce.  So, regardless of whether you have an attorney or not, here are some ways to keep the costs of your divorce down:

1. Manage your emotions.  Divorce is incredibly difficult even in the best of circumstances.  It is likely that you have some strong emotions around it.  But the court and legal process generally will not be concerned about these emotions, and the more  you bring them into your divorce, the more you will likely pay.  Whether it’s spending excessive time with your attorney discussing the emotional issues or pursuing a losing issue because of an emotional attachment, emotions can bankrupt you when they take center stage in your divorce.
2. Get professional help. As a part of managing your emotions, get the support you need for them by finding qualified mental health professionals to help you through it.  Your lawyer, your family, and your friends will be a great support during this time, but do not mistake any of them as qualified advice helping you through the roller coaster of emotions in divorce.  Find a therapist if you need one.
3. Get – and get rid of – qualified professional help when appropriate.  Hire professionals who are going to work with you, for you, and who are on the same page as you.  If you feel like your lawyer doesn’t care, or is gouging you, or won’t pay attention to you or return your calls, then get rid of him/her.  Your divorce is yours, and you should have legal counsel that you feel comfortable with, who understands what is important to you, and who is reasonable and professional about fees.  Same with your therapist.
4. Play fair.  The court and legal process in California has no patience for bids for revenge.  Mud-slinging and nasty declarations for the purpose of hurting the other party can not only rebound and hurt you, but can cost you unbelievable amounts of money.  They also drag on the process, increase the hostility between you and your spouse, and ultimately hurt your children.

Mediation for California divorce & family law disputes: What is it? Why is it helpful? Who needs it?

Mediation for California divorce & family law disputes: What is it? Mediation is a way for couples to resolve their family law case (divorce, custody, support, visitation, asset division) outside of court. The couple can work with or without attorneys, and they meet with a mediator (that’s me) to discuss the issues before them in their case. Depending on the case, the number of issues to resolve and the intensity of the dispute, mediation can take two to many more sessions. In most of my cases, the issues are resolved in about two meetings.

Why is it helpful? Mediation is helpful for a variety of reasons. First, it’s MUCH cheaper than each spouse hiring their own attorney. Mediation can cost from about $3,000-10,000 TOTAL while just hiring an attorney for ONE spouse can be as much as $5,000 to start. Second, couples in mediation can come to agreements that the court is not permitted to make. For example, if the couple wants to make provisions for the payment of their child’s college expenses, then they can. The court is not permitted to make sure orders. Third, mediation is private, so the couple does not have to air their dirty laundry (and finances) in public court documents. Finally, mediation is a way for couples to OWN the agreements they make. Individuals in a dispute are more likely to disobey a court order handed down by a judge (who doesn’t know you, doesn’t know your situation, and makes a decision based on a few short minutes of listening to argument) than they are an agreement they developed themselves. There’s buy-in for decisions made in mediation, which makes all the difference in the world. As a side benefit, mediators are trained in diffusing the emotions of a family law case…and court proceedings are not really known for this.

Who needs it? Anyone with a family law case who would like to preserve their finances for themselves instead of spending it all on attorneys. Also, family law litigants who want to ensure that their children are as minimally damaged by the divorce as possible.

What’s not to like about mediation?

Estate planning, the Forbes Guide

Don’t believe me when I talk about the importance of estate planning, for everyone?  Here is the Forbes Guide to Estate Planning, which echoes much of what I have said in my various posts, and even includes a guide to estate planning “on the cheap”!

Avoid these shortcuts in estate planning and save your assets, protect your family, and leave a legacy

We’re all looking to save money and get our to do list done as quickly and easily as possible.  But when it comes to estate planning, quick and cheap shortcuts can end up not only costing you in the long run, but can hurt both your family and your legacy.

For example, if you decide to forego an estate plan for your real property, and instead opt for joint tenancy, then you are at best just delaying the probate process, and at worst exposing your home to complete loss in your lifetime. With joint tenancy, there may not be any need for probate or transfer proceedings at the death of the first spouse (just some simple) paperwork, at the death of the survivor, the property goes into probate, which can take years and cost up to 10% of the gross estate value, which can be in the tens of thousands of dollars even for estates with just a house – even one with substantial debt.  Putting a child on title to the property does not solve this problem, and can lead to your child’s creditors seizing the house, the inability to undo the transfer at a later date when needed, a loss of control over the disposition of the house, more complications in transfer at the survivor’s death, and more.

Another shortcut is either being incomplete or too vague in your estate plan documentation.  If you have a living trust, it must be funded completely.  It does not serve you or anyone else to leave “just that one account” outside the trust since it ‘has so little in it.’  Why leave a small account – or a large one – outside the trust and make it more difficult for your family to transfer it? It’s possible then that the bank will just get your money since it will be too much trouble to transfer the account outside the trust.  In addition, if you have provisions for the distribution of your estate, make sure you have alternate provisions in case your beneficiaries do not outlive you.  For example, if you are leaving everything to your children, make sure you have a provision for who gets your estate if the airplane goes down and you all pass at the same time.

There are a lot of aspects of estate planning that can easily be completed improperly, costing you, your family, and the estate you worked your life to build. Estate planning is not the place to look for a quick or cheap solution, but rather to take the time to ensure that all you’ve worked for is left just the way you want it.

Financial Advisors & CDFA in California divorce

I met with a financial advisor today, and he has the designation of being a CDFA, or “Certified Divorce Financial Analyst.” He is an expert with working with people who are divorced, getting a divorce, or thinking about it.

The more I think about it, the more I think that it’s critical for someone who is divorcing to have the support of a financial advisor. Take the situation when you’re dividing accounts. Say you have an account with Schwab and an account with another broker. They each have roughly the same amount of money in them, so you and your soon-to-be-ex decide to each take one account. But does anyone look at the projections for the accounts? What if one account is doing poorly and one is doing really well? Attorneys aren’t trained to make those kinds of evaluations. This is a reason to see a financial advisor – especially a CDFA – if you’re getting a divorce, or even thinking about it.

Another reason: Generally, I saw in my practice that in most couples, one spouse was ‘in charge’ of the money in the relationship. They handled the bills and expenses, did the taxes, and dealt with the CPA or financial advisor. Often, the other spouse had not a clue what the couple had, leaving the decisions up to the other. While this is (I think) a reasonable marital division of labor, it causes big problems for the spouse in the dark when the issue of divorce comes up. Suddenly the spouse who doesn’t know anything has to take a crash course in finances, household budgets, and the like. He or she also probably wants nothing to do with the couple’s advisors, as they’re likely to go with the person they’ve been dealing with all along. This is where a financial advisor can mean the difference between struggling and flourishing.

Finally, and you may know this about me, I am a planner. I do estate planning and feel it’s absolutely essential that EVERYONE has an estate plan – SOME kind of plan – and if they have children or a house, it becomes urgent. But that’s another story and another blog. The same is true for financial planning. Right now, you’re at Point A in your life. At some point, you want to get to Point B. How are you going to do that, financially? What if you don’t even know what your Point B looks like? You find these answers by utilizing the help that’s around you, and in this case, it’s a financial advisor.

I am spending some time in the next few weeks talking to several CDFAs, and I’ll pass along the pearls of wisdom I learn. I meet with them so that I can feel comfortable referring my clients to them.