In Divorce

I often get a call from someone contemplating a divorce. They want to know what steps they should take before they start. Since that is impossible to answer accurately without more information, I request it. Are they talking about kids, finances, safety issues, evidence, procedure? What, exactly, do they want to know? Here are some of the most frequently asked questions and a brief excerpt of my response. Disclaimer: all cases are different and these answers may not apply to your case, these are not complete answers, nothing herein should be construed as legal advice. Here we go:

FINANCIAL CONSIDERATIONS OF DIVORCE

  1. Some people want to protect money or property from the other spouse. They want to know if they can transfer/hide these assets. This is a big no-no. Not only can an attorney not advise you on how to do this, it would be unwise to do so. It is very hard to eliminate traces of assets that once were. A good attorney will almost always be able to spot the flags of missing assets. And if they can’t find the trail, then a financial auditor will. Once caught, your credibility is shot, making the rest of your case an uphill battle. It is a much better use of your time and money to identify and develop a basis to support your claims for the best possible outcome.
  2. Some people are afraid they will not have access to money once the process is started. This is a valid concern, especially if the other spouse is controlling with the finances and/or the concerned spouse does not earn an income.
    1. If the concerned spouse has access to the bank accounts (if they are joint) and there are any excess funds (funds not needed to cover auto withdrawals and necessary monthly living expenses) then it may be advisable to withdrawal a reasonable amount out and deposit into a separate account in their name. What is reasonable depends on the circumstances. It is important in this instance to keep good records of how the money is spent and to use it for only for reasonable and necessary expenses. Retainer fees for your divorce attorney fall under this category. If there is a real fear that this action may cause the other spouse to become violent, then this is not the best choice.
    2. If there is no access to joint bank accounts or no excess funds to withdraw, then credit cards could be a source for both cash and attorney’s fees. If the credit card is controlled by the concerned spouse, it’s better to just charge what they need for initial expenses, until some temporary support can be obtained. If the credit card is controlled by the other spouse, the concerned spouse may only have a small window to obtain a cash advance or make a charge to obtain an attorney before they are removed as an authorized user.
    3. If the concerned spouse has access to other liquid assets (mutual funds, stocks, etc) these would be able to be cashed for necessary living expenses and attorney’s fees. Again, keep good records as you will eventually need to account for any liquidated funds.
    4. Retirement accounts would normally be the last accounts to use as there is greater chance the tax and penalty implications will be greater. The concerned spouse should consult a tax professional (someone who is not going to report to the other spouse) to determine which liquidation will produce the least financial harm.
    5. If none of the above is an option, then the concerned spouse needs to look to borrow the funds. It is advisable to consult with an attorney and try to determine what a realistic retainer is going to amount to. Then try to figure out what your monthly needs are and plan on at least two months cushion although three would be better. It is in your best interest to be as honest and accurate as possible with whoever you are borrowing from as to what you need. It is usually best to put your loan in writing if you are expected to pay it back.
  3. Some people are uninformed with regard to the household income, assets or bills. They are worried that their spouse is going to try to hide or change information once the divorce process starts. In these cases, it is in the concerned spouse’s best interest to try and obtain copies of all financial records prior to starting the case. Obviously, the search and copying of these records should take place while the other spouse is gone. The copies should be kept in a safe place, apart from the marital home. Ideally, they should go to the attorney representing the concerned spouse.
  4. I get many calls requesting what amount of child support or alimony will have to be paid/will be received pursuant to an impending divorce. No attorney should try to answer this question over the phone. There are various, specific pieces of information that need to be obtained just to do basic support calculations. Then there are many factors that need to be considered (based on the specific facts of your marriage) to determine the likelihood of the results of those calculations.

In short, there is no simple calculation that will answer the questions. At minimum, a full consultation with some intense questioning will likely produce enough information for me to calculate some broad ranges of numbers for child support and alimony, with more accuracy toward child support

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