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Divorce Financial Planning Brochure

divorce financial planning

Dianne NolinDianne Nolin, CFP®, CDP
First Vice President
Wealth Manager
CERTIFIED FINANCIAL PLANNER™
Certified Divorce Planner
Dianne.Nolin@spireip.com
703-748-5838

While not an outcome, most of us want to consider when getting married, divorce is a common occurrence today. Studies indicate that 41% of first marriages and 60% of second marriages end in divorce.

Pre-Marital Money Talk:

Don’t fool yourself into thinking you can change another’s basic money personality. Mostly it’s ingrained from the way we’re raised. But you can certainly understand each other and come to terms before it becomes a sore spot in your marriage.

Money disagreements in a marriage can be nasty and destructive, but they can be substantially avoided by discussing your facts and feelings about money before you tie the knot. You’ve got to understand each other’s “money hangups,” spending habits, financial situation and each other’s expectations. Here are some serious questions to agree on… or not:

  1. What, if any, are your financial assets going into this marriage? Do you feel you can be open about this? If not, why not?
  1. Will you have a pre-nuptial agreement? If yes, to protect whom and/or what?
  1. Are you willing to put everything in joint names? Or do you want to maintain your assets separately? Will you maintain separate checking accounts? Savings accounts? Whit is that money for?
  1. How much income do you each have? From your job? From other sources?
  1. Do either of you have any debts? What are they? Who will be responsible for them after you marry?
  1. Who will handle the checkbook and household bills? What money goes into this house account? I.E., paychecks, interest and dividends; alimony or child support checks; gifts; any miscellaneous income.
  1. What about credit cards? Will you share one? What charges go on that? Will you each have your own? What charges would go on those?
  1. Who will pay for your clothes? Your car insurance? Trips? Entertainment? Gifts – for both your families? For your friends? Who pay for home furnishings? Your next car?

  2. Will you both have freedom to spend as you wish or will you have to answer to each other? All the time?

  3. If there’s only one wage earner, will the non-earning spouse receive an allowance? Free access to the checkbook? Does the earned income belong equally to you both? Or does the wage earner have control?

  4. Have you talked about new wills? Trusts? Will you change beneficiaries for you IRA’s and pensions? To each other?

  5. What about life insurance? Are you planning to protect each other?

  6. Who’s going to make the investment decisions? What if you don’t agree with each other? Will you invest anyway?

Who’s going to own the marital residence? If not joint ownership, is there any protection for the ‘non-owning’ spouse in case of death? Divorce?

Bringing children into the marriage? Watch out! This subject needs to be well-aired – and be honest. When maternal and parental instincts are involved, sensibility can go out the window during a conflict!

  1. If there’s child support, what is it to be used for? Does it get thrown into the “pot”?
  1. What do you see as your financial responsibility towards your fiancées children? Does your fiancé understand your financial responsibility to your own children?
  1. If both have children – and one “set” is more affluent, will you need to play catch up?
  1. Will you be comfortable with your spouse spending on his (her) children and not on yours?
  1. Who pays for the children’s clothes? School? Camp? Vacations? Insurance? Dentist? Etc.?
  1. What about college? Who’s going to pay for those expenses? Will money be saved along the way for this? From what income?

You will need an attorney to handle the legal issues and documents regarding your divorce but a financial planner can play an important rule in the property settlement process.

CDP Specialty

Three major concerns to dividing property in a divorce:

  1. What is mine, yours, and ours?
  2. How much is our property worth?
  3. How are we going to divide the property?

Equitable Distribution

    • A couples property is distributed equitably, which does not mean equally. In other words, the result may not be a 50/50 split.
    • Non-property issues are often considered, such as earnings potential, career assets and personal investments.

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