Collaborative
Divorce - Breaking Up Doesn't Have To Mean Breaking The Bank
By Munish Dev 
The
collaborative
process, started by
Both
parties agree
not to enter litigation. Couples often hire attorneys trained in
collaborative
law and bring in shared accountants, financial planners, business
valuation
experts, child psychologists and even life coaches to help the couple.
Unlike
impartial mediators, the attorneys can advise their clients as
advocates.
Proponents
say it
dramatically cuts the tension--and the costs--involved in traditional
contested
divorces.
There
are skeptics,
however. Among the critics are those who say the peacefulness of the
process
encourages divorce and attorneys who say the best representation for
any
divorcing spouse is a vigorous offense.
Participants
in a
collaborative divorce sign documents promising to disclose all assets,
and
their attorneys agree to walk away from the case if the parties end up
going to
trial.
An
average contested
divorce can run about $30,000, but it's not uncommon for some to reach
six
figures, attorneys say.
Collaborative
costs
vary widely, depending on the number of professionals involved and the
number
of meetings it takes for spouses to agree on a settlement.
Collaborative
attorneys estimate that most of these cases settle for half to a third
of what
their bill would have been with a court battle. Settlements must be
reviewed
and approved by a judge.
Costs
ranged from
$5,000 to $21,000, representing as high as 15 percent of annual
household
income.
Even
friendly
divorces come with costs that reach beyond the courtroom, however, and
women
especially tend to feel the strain. Divorce Magazine reported the drop
in
standard of living for women after divorce was 45 percent in 2000.
About 20
percent of people filing personal bankruptcy had been recently
divorced,
according to Harvard University law professor Elizabeth Warren, who has
studied
families in dire financial straits since 1986 and who is considered one
of the
leading national authorities on bankruptcies.
Your
staff: In
addition to consulting attorneys, divorcing couples are turning to
specialized
financial planners to run living cost estimates, decide the value of
family
businesses and prepare investment return projections on proposed
settlements.
Typically
these are
accountants, certified financial planners or other financial advisers
who offer
a specialized divorce practice. Someone who has a Certified Divorce
Financial
Analyst designation has also taken a self-study course and completed
four exams
related to divorce finances, but be sure to inquire what other
credentials he
or she has. Training is done through the Institute for Divorce
Financial
Analysts in
If
you'll need help
valuing assets or a business, or suspect your future ex may be hiding
money you
also may need to contact a forensic accountant.
If
you are the
primary breadwinner but are considering a lower-paying job as you go
through
the divorce transition years, tread carefully. Some judges will require
you to
maintain your family's previous standard of living. A judge may rule
you're
more than capable of a high earning power and decide to award less
alimony.
Your
portfolio: If
you think you'll have to draw down some retirement money to cover
expenses in
the first few years of divorce, do it sooner rather than later, this
way you
can take a distribution at the time of divorce without a penalty,
Your
tax return: Be
sure to consider the tax consequences of your divorce settlement. The
more
money a primary breadwinner doles out as alimony instead of child
support, the
more he or she can deduct from income, experts say. The spouse
receiving the
alimony will have to pay income taxes on the money, but usually it will
be at a
lower tax bracket. Child support, on the other hand, isn't deductible
from
income.
|
Munish
Rathee working for Ferris consulting, some of the client sites he is
working on are Seattle divorce attorney, Sonoma County Divorce Attorney,
and St. Louis mediator. Article
Source: http://EzineArticles.com/?expert=Munish_Dev |