Financial Preparation Before Divorce

A divorce settlement is bound to have a far reaching impact on all the family members. A few pounds here or there could make the difference between a life of misery or comfort. Hence it is imperative that people opting for a divorce approach the related financial issues in a planned way.

What is Divorce Financial Planning

Divorce is always about past. What went wrong? Who was the primary provider? What major investments were made? Contrary to this, divorce financial planning is a leap into the future, towards a new life. Futuristic planning and projection is an integral part of divorce settlements.

Divorce financial planning involves conducting the financial issues accompanying a divorce in a planned way, so as to ensure the maximum welfare of the person concerned. It is financial planning done to ensure that you are able to get by and fare well financially after divorce. It may either be carried out by an individual own its own or one can hire the services of professional divorce financial planners. Divorce financial planning reduces one’s ambiguity about future and helps one to proceed ahead with a sense of certainty.

Who is a Divorce Financial Planner

Divorce financial planners are basically the financial experts who specialize in making long-term financial projections for their clients going through a divorce. The blend their personal acumen and skill for financial planning with the actual divorce process in a pragmatic way. They intimate their customers regarding the options available to them and help them set priorities.

Earlier divorce financial planners were hired to help the divorced people plan their future prospects. Now it has become a field of specialization that relates to the entire divorce process and aids the divorce proceedings from beginning to end. People often think that they do not need a financial planner when they already have a solicitor. The fact is that a divorce attorney always requires apt financial feedback about both the parties so as to safeguard the interests of his/her client. Hence a financial planner can always make valuable contributions to the process of divorce litigation.

How do Divorce Financial Planners Help

Divorce financial planners have a vital role to play in all the phases of divorce. Before the actual divorce process is initiated, they advice their clients about the financial information and documents they should possess to facilitate a successful settlement. Most of the times people are not aware that they need to have copies of financial statements, investments, bank records, tax returns, credit card reports, etc. to make a sound start. Financial planners also advice their clients about the necessary changes to be made in joint accounts, credit lines and property titles before divorce.

Many a times it happens that financial matters in a marriage are managed by one partner alone. In a divorce situation, the financially active partners try to conceal the details of some of their assets and investments from their spouse. It becomes very difficult for the affected spouse to extract all the financial information about his/her partner without the assistance of a specialist. Not knowing about the existence of the concealed assets or hiring a forensic accountant to seek them could prove costly. Financial planners could give a fruitful turn to this investigation by pointing the inconsistencies in the available data.

During a divorce, divorce financial planners help the solicitors arrive at a realistic assessment of claims related to child support, alimony and division of property by taking into consideration variables like inflation, future income, income tax, pay increases, retirement plans, pension, mortgages, etc. if their exist any major lacuna in the projected settlement, they can suggest plausible alternatives that are more conducive for their client.

Once a divorce is finalized, financial planners inform their clients about the fundamentals of budgeting and help them make profitable investments. Some financial planners even manage the assets of their clients to ensure maximum returns. They give them a clear picture of their current financial situation and help them balance their income with their liabilities.

Conclusion

Considering the expected fall in the income of both the partners after divorce and the expected obligation of providing for child and spousal support, divorce financial planning is certainly a step in the right direction. It makes the financial situation more secure in the post divorce period.

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